New Delhi: Up next on the government's PSU disinvestment list is a public sector joint venture company that is involved in the manufacturing of steel. Those are the only clues that have been given away by the Department of Investment and Public Asset Management (DIPAM) on its website so far. However, sources have said that the description fits Neelanchal Ispat Nigam Ltd (NINL), an Odisha-based joint venture company between MMTC Ltd and the Odisha government. It seems to be the next PSU that the government is taking up for disinvestment.
A notification on the DIPAM website showed that the government has already started the process to engage an advisor, asset valuer and a legal advisor for the "strategic disinvestment of 100 percent shareholding of CPSEs in a public sector joint venture company engaged in manufacturing of steel." The DIPAM notification makes no reference to the NINL or any other state-owned steel manufacturing JV.
Majority of the shareholding in NINL rests with state-run MMTC Ltd — 49.9 percent. The Odisha government via its two undertakings — Odisha Mining Corporation (OMC) and Industrial Promotion & Investment Corporation of Odisha Ltd (Ipicol) — owns 26 percent stake. The rest of the shares are with NMDC and BHEL.
NINL has been piling losses for a long time. However, financial year 2018-19 was the first time when it turned its fortune around and posted a robust growth of 126 percent in net sales turnover at Rs 2,100 crore. It was the highest-ever net turnover achieved since the inception of NINL.
A report published in a newspaper in November, however, claimed that the company had sent an SOS to the Odisha government that the situation was going from bad to worse due to lack of finance and a shortage of raw material to run the steel complex. In September, the government had asked NINL's shareholders to infuse capital proportionate to their stakes to keep the company running until its disinvestment.
The Centre has been considering the revival of the loss-making plant through merger or disinvestment for quite some time now. In June this year, the Odisha state government had expressed its willingness to shed its minority stake in the joint venture.