The Rs 276 crore thus raised will be utilised to finance the firm's expansion plans. Jindal Vijaynagar plans to increase the capacity of its integrated steel plant at Toranagallu from 1.25 tpa to 1,6 tpa, investing Rs 830 crore.

The firm's shareholders had in 1997-98 approved a proposal to hike the promoters' stake by alloting 12.6 crore equity shares of Rs 10 each. But the promoters' scuttled the plan owing to paucity of funds.

The main promoters of Jindal Vijaynagar are the OP Jindal group of companies-Jindal Iron & Steel Company Ltd (Jisco), Jindal Strips Ltd (JSL), Saw Pipes Ltd (SPL) and other associate firms.

Jindal Vijaynagar has sought shareholders' nod at its forthcoming annual general meeting on September 1 to increase the subscribed equity. The firms' equity will go up from Rs 1,175 crore to Rs 1,451 crore after the planned preferential allotment is subscribed.

The firm will raise Rs 300 crore via private placement to meet its additional capital needs in the days to come. Private placements will be offered to foreign institutional investors, domestic financial institutions and mutual funds. While foreign institutional investors hold 1.32 per cent, institutions and mutual funds have cornered 11.04 per cent.

Meanwhile, Jindal Vijaynagar has signed a memorandum of understanding with Indian Institute of Science, Bangalore, for outsourcing research and development activity. According to the agreement, the institute will take up research and development proposals on adaptation and assimilation of Corex technology to suit local conditions. The firm's manufacturing facility and production is based on Corex technology for which it has an alliance with VAI of Austria.