India’s RINL defers IPO until September

The initial public offering (IPO) of the Indian state-owned Rashtryiya Ispat Nigam Limited (RINL) which was to start from July 2012 has been deferred until sometime around September 2012 due to adverse market conditions and uncertainties over potential valuations, a senior official at India's Ministry of Steel told SteelOrbis during a phone interview on Wednesday, June 6.
 
According to the draft red herring prospectus prepared for the divestment of the Indian government's holding in RINL, the latter would offer 481 million shares of the company to be offered to institutional and retail investors through book-building. The final red herring prospectus would now be formalized and submitted for clearance to the regulator Securities and Exchange Board of India (SEBI) in July 2012, the official said.
 
"The deferment of the IPO may have a silver lining since by the time of the float RINL was likely to get the final approval for a captive iron ore mine in Rajasthan which has a reserve of about 300 million mt and this could positively impact valuation of the shares to be offered," senior company officials said.
 
As SteelOrbis previously reported, RINL, popularly known as ‘Vizag Steel Plant', located in the southern Indian port town of Vishakhapatnam, has secured its own captive iron ore resources and is carrying out an expansion of steelmaking capacity to 6.3 million mt per year from the current 3 million mt per year with an investment of $2.5 billion.