The Indian central government confirmed plans to divest from six steel companies including Rashtriya Ispat Nigam Limited (RINL) or Vizag Steel (VSP). India’s Union Minister of Finance Bhagwat Karad identified RINL, Neelachal Ispat, NMDC’s steel plant, Alloy Steel Plant in Durgapur, Visvesvaraya Iron and Steel, Bhadravathi and Salem Steel as disinvestment targets in the lower house of parliament, while answering a query.
Divestment of these steelmakers is part of the government’s policy to privatize state-owned companies in non-strategic sectors. The Union Cabinet had approved the disinvestment of these Central Public Sector Enterprises (CPSEs) on January 27, 2021.
RINL’s workers are protesting against the privatization of the company. Early in the month, the government invited bids from transaction advisors and legal advisors to manage the sale of the steel plant.
In Q1, RINL produced 1.237mn mt saleable steel, which is close to double or 98pc growth from the production of 626,000mt in Q1 2020. Production in Q1 last year was impacted by the nationwide lockdown. The company sold 1.043mn mt steel in Q2, up 54pc from 678,000mt in the prior-year quarter. Revenues stood at Rs52.2bn ($69mn), up by 126pc from a year ago.
Domestic sales volume in Q1 was 743,000mt, up by 103pc from the prior-year quarter, which was hit severely by the first wave of COVID-19 pandemic and strict nationwide lockdown.
In FY2020-21, RINL sales volumes managed to grow by 4pc to 4.45mn mt from a year ago. While revenues increased by 13pc to Rs180bn ($2.41bn).
($1 = Rs74.59)