The Hindu Business Line : RINL to raise Rs 2,500 cr to fund expansion

RASHTRIYA Ispat Nigam Ltd, which runs the Visakhapatnam Steel Plant, proposes to raise debt of Rs 2,500 crore from the market. The money will be used to fund its expansion project, which will double its capacity to nearly 7 million tonnes a year. The cost of the expansion programme is estimated at Rs 8,250 crore (according to a tender notice). The other Rs 5,750 crore will be brought in from internal generations.

Speaking to journalists here, the Chairman and Managing Director of RINL, Mr Y. Siva Sagar Rao, said the company was looking for opportunities to form joint ventures with coal mining companies abroad as well as to take over steel units in India and abroad.

Pointing out that RINL was disadvantaged because it does not own coalfields, Mr Rao said that the company had been sending teams to Australia, the US and Canada, to explore opportunities for forming joint ventures with companies that own coal mines there.

The proposal for taking over steel units, on the other hand, does not appear to be anything more than a thought at the back of the mind. "If there are opportunities, why not?" Mr Rao said, answering a question.

Asked if the public sector company would not have to go to the Government for approval for taking over other units, Mr Rao replied in the affirmative. RINL has about Rs 3,000 crore invested in bank fixed deposits, but is not allowed to utilise more than Rs 40 crore out of it without the Government's permission.

Mr Rao said that the company, while waiting for Government's approval for the Rs 8,250-crore expansion project, had taken steps to raise production by 500,000 tonnes by debottlenecking operations. This exercise would cost about Rs 500 crore, he said.

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