(MENAFN- Arab News) CAIRO: Egyptian Steel expects to open two new factories by the middle of 2016 raising capacity to 3.5 million tons per year and boosting its market share Chairman Ahmed Abou Hashima said.

In addition to its plants in Alexandria and Port Said it aims to launch a 3.5 billion Egyptian pound ($460 million) facility in the Nile city of Beni Suef this July or August with an annual capacity of 1.36 million tons.

It also hopes to start a factory in Ain Sukhna on the Red Sea by mid-2016 said Abou Hashima.

"We are seeking to acquire 20-25 percent of market share after production starts in all of these factories" he said. Egyptian Steel currently claims 10 percent of the market.

"There is strong demand in the market and we expect that there will be growth. Many projects. Housing. Construction. Infrastructure."

The expansion plans reflect growing optimism that the economy can recover after years of turmoil triggered by the uprising that toppled autocrat Hosni Mubarak in 2011.

Egyptian Steel currently produces 800000 tons of steel per year and aims to raise capacity to 3.5 million tons annually once its new projects are completed.

Abou Hashima said it was looking at a feasibility study for a fifth factory that would be powered by coal.

He also said he was involved in organising an investment conference in the Red Sea resort of Sharm el-Sheikh in March that the government hopes will attract billions of dollars of cash.

"We will have real investment" he said praising President Abdel Fattah El-Sissi's efforts to improve government finances and cut bureaucracy.

Egyptian Steel was established in 2010 as a joint venture between Egyptian and Qatari interests that brought together three existing firms. Egyptian Steel now has capital of about 2.2 billion Egyptian pounds ($290 million) and plans to raise a further 350-400 million pounds.

Abou Hashima reiterated it is preparing for an initial public offering but added: "We must finish the factories first."