L&T bags SAIL EPC packages as IISCO expansion accelerates

L&T strengthens position in India’s metals EPC market

Larsen & Toubro (L&T) said it has secured a significant order in the domestic metals sector for EPC projects and products from Steel Authority of India Limited (SAIL) and other customers. The order has been awarded to L&T’s Minerals and Metals (M&M) business vertical. The wins come as SAIL advances multiple brownfield and greenfield expansion plans across its integrated steel plants. SAIL has been tendering and awarding large packages tied to capacity additions, especially at its IISCO Steel Plant (ISP) in Burnpur, West Bengal, and Bokaro Steel Plant (BSL) in Jharkhand. For L&T, the awards deepen its footprint in large steel plant infrastructure where execution capability and supply chain reach matter. For SAIL, the contracts are part of a broader investment cycle aimed at lifting production capacity towards its stated targets.

IISCO Steel Plant: capacity ramp-up forms the centrepiece

SAIL is increasing the crude steel capacity of the IISCO Steel Plant at Burnpur from 2.5 million tonnes per annum (MTPA) to 6.5 MTPA under its expansion and modernisation programme. Under this project, L&T’s M&M business has been awarded the complete engineering, procurement and installation (EPI) package for several critical process units. The scope includes a Coke Oven Battery, a By-Product Plant, a Basic Oxygen Furnace, and a specialised material handling equipment package. These units are key links in the upstream and steelmaking chain and typically anchor timelines for integrated steel expansions.

Separately, SAIL has tendered out a blast furnace (BF) package tied to the planned expansion at IISCO, indicating movement into what was described as a decisive phase for the project. The overall IISCO expansion project referenced in the update was sized at ₹45,810 crore and is expected to more than double the unit’s capacity. SAIL awarded the BF package to a consortium of Danieli Corus earlier last week, with a target completion timeline of 41 months. The BF is described as capable of producing 4.3 million tonne of hot metal and forms the core of the 4.08 mt expansion undertaken by SAIL. Post completion, IISCO capacity is projected to rise to 7.1 mt from the current 2.5 mt, as per the same update.

Bokaro Steel Plant: upstream package adds momentum

Alongside Burnpur, SAIL’s Bokaro Steel Plant in Jharkhand is undergoing a major upstream expansion. L&T has been awarded a key package for setting up Sinter Plant #2 at Bokaro. Sinter plants are critical for preparing iron-bearing feed for blast furnaces, and new sinter capacity often accompanies BF and steelmaking additions. The Bokaro award extends L&T’s role across multiple SAIL sites rather than being confined to a single plant upgrade.

Other IISCO awards: sinter plant complex and EOS technology

IISCO has also awarded what was described as its first major contract under an integrated steel plant expansion of ₹35,000 crore (USD 3.94 bln). Under that contract, a consortium of Metso India Pvt. Ltd., Kolkata, and Outotec, Germany, secured an ₹300 crore (USD 33.8 mln) order to build a 2.673 mln tons per annum sinter plant complex. The facility will include a 252-square-metre sinter machine and is expected to be operational within 40 months. The new sinter plant complex (SP-3) is expected to supply about one-third of IISCO’s sinter needs. The project includes Emission Optimised Sintering (EOS) technology, aimed at cutting fuel use and reducing emissions.

SAIL’s capacity road map and investment plans

SAIL’s current crude steel production capacity is stated at 20.63 million tonne per annum in the material. In line with the envisaged enhancement of crude steel production to 300 million tonne by 2030, SAIL has planned to raise its own crude steel production capacity to 35 million tonne per annum by 2030-31. The proposed scale of indicative investment to reach around 35 million tonnes per annum is around ₹110,000 crore. Funding is planned through a combination of debt and equity, normally in a 1:1 ratio, according to the information shared. A land bank study is in progress, and a preliminary study indicates availability of land for the first phase of the envisaged expansion.

The company has also said it has received approvals at board and ministerial levels for a ₹100,000 crore capex plan, spanning greenfield and brownfield projects, to lift capacities by about 75 per cent to 35 MTPA by 2030. It also indicated work on a detailed decarbonisation plan to bring down its carbon footprint.

Capex guidance: multiple official estimates in circulation

SAIL’s near-term spending plans have been outlined by different officials in separate updates. One update cited SAIL looking to spend ₹7,500 crore as capex in the ongoing fiscal, about 25% higher than FY25, with capex last year close to ₹6,000 crore. It also said that in April to June, SAIL had already spent ₹1,642 crore. Another update quoted SAIL’s CMD stating a capex target of ₹6,500 crore during the current financial year, adding that most of the expansion capex tied to the ₹100,000 crore-by-2030 plan would start “flowing from FY26.” Both statements point to an elevated investment phase even as tendering and ordering continues plant by plant.

Rourkela plan highlights the scale of SAIL’s next phase

SAIL has also outlined a major expansion at its Rourkela Steel Plant (RSP), where it plans to more than double capacity to around 9 million tonne per annum at an investment of about ₹30,000 crore. RSP’s current contribution is stated at 4.4 MTPA out of SAIL’s total 20.30 MTPA steelmaking capacity in that update. The expansion aims to raise RSP capacity by 5 MTPA to 9.4 MTPA by 2030 and will require about 1,200 acres for the greenfield project. The planned facilities include raw material handling, coke oven stamp charge battery, sinter plant, thin slab caster-direct rolling, cold rolling mill, silicon mill and logistics, along with a new blast furnace and steel melting shop. A railway line connecting Dumertra station to RSP is under construction, and a second rail connection is being executed under a cost deposit scheme.

Key numbers at a glance

Market impact: what these awards signal for steel and EPC

The project awards underline the pace at which India’s public sector steelmaker is moving from planning to execution across sites. For L&T, the order intake reflects continued demand for integrated steel plant engineering, procurement and installation work and associated product packages, particularly in upstream and steelmaking units. For SAIL, the sequencing of packages - including blast furnace, sinter plants, coke ovens, BOF units, and material handling - shows an attempt to align critical-path equipment with multi-year timelines.

The investments cited across updates are large and spread over years. SAIL’s indicative investment to reach around 35 MTPA is pegged at about ₹110,000 crore, while current-year capex targets have been cited at ₹6,500 crore and ₹7,500 crore in different statements. With financing planned through a 1:1 debt-to-equity mix and land studies underway, the execution phase is likely to involve sustained tendering, vendor mobilisation, and regulatory and logistics work.

Analysis: why the IISCO and Bokaro packages matter

IISCO and Bokaro are among SAIL’s key integrated assets, and upstream packages like sinter plants and blast furnaces often determine whether downstream rolling and finishing expansions can be fully utilised. The BF package at IISCO, with a stated 41-month completion target, provides a time marker for when core ironmaking additions could come online. Meanwhile, L&T’s EPI scope at IISCO covering coke ovens, by-product handling, BOF and material handling suggests involvement across multiple critical units rather than a single isolated package.

The broader picture is that SAIL is trying to lift capacity from the 20-21 MTPA range to 35 MTPA by 2030-31, with separate announcements also pointing to a next phase targeting 50 million tonnes after that. In that context, each awarded package reduces uncertainty around execution and helps map out capex and construction activity over the next several years.

Conclusion

L&T’s new metals-sector order from SAIL and other customers adds to its presence in India’s steel plant build-out cycle, with major EPI work at IISCO and a sinter plant package at Bokaro. For SAIL, the award flow - including the blast furnace package at IISCO and a separate sinter plant complex contract - indicates that large expansion projects are progressing through tendering and contracting. Next cues for investors are likely to come from additional package awards, updated capex spending disclosures through the fiscal year, and timelines announced as projects move from engineering to on-site execution.