Srikalahasthi Pipes

Lanco Industries Limited (LIL) was incorporated on 1 st November, 1991 by Lanco Group of Companies to manufacture Pig Iron using Korf (German) technology and Cement. The unit is located at Rachagunneri Village on Tirupathi - /Srikalahasthi road which is about 30 kms. from Tirupathi and 10 kms. from Srikalahasthi. The installed capacity of Pig Iron was 90,000 TPA and with similar capacity 90,000 TPA for cement. Due to the poor demand and other reasons, the operations of the cement unit of the Company was suspended and the unit was reengineered for producing a different product mix having potential in south India. As a measure of forward integration project for adding value to the Pig Iron manufactured by the Company, LIL floated an another company named Lanco Kalahasthi Castings Limited (LKCL) on 4 th March 1997 to manufacture iron castings and spun pipes in the same campus of the Company with an annual capacity of 40,000 TPA and 35,700 TPA respectively. Accordingly, LIL had an arrangement with LKCL for supply of molten iron and Pig Iron to LKCL, being a value added product, as such iron pipes manufactured by LKCL offered better returns. However, due to falling Pig Iron prices, increase additional capacity in the industry, competition and the technical & financial assistance, the operations of both LIL and LKCL were effected and the Company was exploring financial and technical strategic alliance with Indian / Foreign Partner. During the same time M/s. Electrosteel Castings Limited, was also looking for additional capacities for producing spun pipes. Considering the synergies involved, Lanco Industries Limited entered into a strategic alliance partnership during December 2002, with M/s. Electrosteel Castings Limited (ECL), Kolkatta a leading manufacturer of CI, Pipes and DI pipes. This was win-win situation for both LIL and ECL.