The largest Russian steel building manufacturer intends to spend more than half of a planned $10 billion expansion in its residential home market after first-half profit more than doubled.

Rising local demand for metal buildings has prompted the company to bump up its budget through 2011, focusing production in Russia, Italy and the United States.

Billionaire Alexei Mordashov, who controls Severstal, has allocated $6 billion to Russia, including two steel building plants that can each produce one million tons of material a year.

"There's a premium in domestic [steel building price] gains over exports and local demand is very strong, which all leads to more money in Russian mills," said analyst Alexandre Starinsky.

Russian metals and engineering companies are benefiting massive infusions of money pledged by the government for home building by 2010 and projects like the Sochi 2014 Winter Olympic complex.

Sales of steel building materials needed for construction grew by more than a third last year alone.

At the same time, Severstal's first-half net income grew to $999 million from $426 million a year earlier. Sales climbed 31 percent.

The earnings were "a positive surprise" for the steel building manufacturer, said Sergei Donskoy, metals analyst with Troika Dialog.

The steel manufacturer's U.S. unit was the only part of its operations to post lower earnings. Severstal North America's earnings before interest, tax, depreciation and amortization fell 15 percent.

The metal building firm said it expected conditions in the U.S. to improve due to reduced output and more stable inventory.