Steel Executives’ Association has made a fervent appeal to PM Modi for the strategic merger of Rashtriya Ispat Nigam Limited (RINL) with SAIL And NMDC. The body says that strategic merger of RINL-SAIL-NMDC as a single entity, all under the Ministry of Steel control, can work as synergy. The letter sent to the Prime Minister is given below for the benefit of the viewers of www.indianpsu.com –
Sri Narendra Damodardas Modi ji,
Prime Minister of India
Subject:- Request for Strategic Merger of Steel Sector – RINL-SAIL-NMDC
Greeting from Steel Executives Association (SEA), RINL.
RINL/Vizag Steel, one of the best steel plant, has been suffering due lack of Captive Iron ore & Coal mines. RINL’s raw material cost is 63% of total cost where as that of SAIL’s & TATA’s is 48% and 35% respectively (both companies have their captive mines). RINL is losing about 800-1000 crores per annum exclusively on account of lack of iron ore. Though, RINL has been performing well, only on account of high input cost on material, our net Profits registered 50% less during 2004 to 2015 FY and has become negative for the last 4 years, added to that huge barrowings (nearly Rs 20,000 Cr) from market to increase the plant Capacity as per GoI plan. It is pertaining mention that RINL has registered PBT of RS 942 Cr during FY 2021-22 is a good sign of improvement. RINL financial position got deteriorated and with a heavy loan burden of Rs 20000 Cr, company is struggling to meet its ends. A Steel plant with high productivity and modern technology as its strength needs your urgent attention.
Strategic Merger : At this juncture, Strategic merger of RINL-SAIL-NMDC as a single entity, all under the Ministry of Steel control, can work as synergy.
A single Maha Steel Unit be formed by merging RINL-SAIL-NMDC, This Mega Steel merger also in line with the recommendations of parliament committee for PSUs submitted in the month of March 2013 shall be able to expand further steel capacities. This shall greatly help to realize the targets of National Steel Policy of 300MTPA steel capacity by 2030-31. Each of steel units has its strengths and weaknesses, but merger of them into single unit would help them to synergize their strengths and turn the weaknesses into opportunities and overall benefits to Nation. RINL will become major plant of SAIL as it has huge land bank, can be expanded to 20 MT and will become export hub for STEEL products.
Raibareli FWTP will become jewel in the crown for SAIL. Highly experienced HR of RINL (having technocrats constructed and commissioned both phases of 3MT and 7.2MT of vizag steel) if blended with SAIL will yield excellent results.
“Steel being an essential component in the growth rate and contributes heavily to the GDP of our country, it should be kept under Strategic Sector of the Nation. “The bigger entity of RINL-SAIL-NMDC can also be able to compete internationally. With “Make in India” concept this merger will pay back large dividends to Government and Nation. At this juncture, Steel Executives’ Association, RINL humbly requests you to take initiative to save Steel sector as a whole.