With Indian government-owned steel producer Rashtriya Ispat Nigam Limited (RINL) poised to report an operating profit at the close of the current fiscal year 2017-18 (ends March 31) after a gap of two years, plans to disinvest 10 percent of government equity holding in the company will be revived, a government official said on Tuesday, February 13.
The official said that the turning around of RINL together with the steel company completing the doubling of its capacity to 6.3 million mt per year and launching a project to further expand to 7 million mt per year through modernization of its plant will offer the right opportunity for the government to go ahead with divestment in the company through an initial public offer and a listing of RINL shares on the stock market.
The government which holds 100 percent equity in RINL had first proposed a 10 percent dilution of its holding in the company in 2012 but this had to be deferred owing to losses incurred by the steel producer, the official said.
At the same time, the Ministry of Steel in a statement before the Indian parliament earlier this month reiterated that, even after the proposed IPO and the government disinvestment in RINL, the basic nature of the latter as a government-owned company will be maintained with the government continuing to hold a majority equity in the company.