RINL's ₹7,000 Crore Lifeline: Clearing Debt, Securing Future

State-owned steelmaker Rashtriya Ispat Nigam Ltd (RINL) has deployed the first tranche of its ₹7,000 crore funding, allocating nearly ₹5,300 crore to clear payment obligations and avert working capital loan defaults, according to an internal report accessed by BusinessLine.

Burdened with high-interest loans of 10–11.5%, RINL has sought lower rates to aid its financial turnaround. Union Steel Minister HD Kumaraswamy has advocated for rate reductions, and in February, RINL’s CMD formally requested the State Bank of India (SBI) to align interest rates with industry norms of 7%–7.75%.

Following the infusion of funds, RINL has returned to profitability, reporting an EBITDA of ₹55 crore in January 2025—a stark improvement from the ₹300 crore EBITDA loss in the same period last year.

SBI, RINL’s largest lender with over ₹5,000 crore in exposure, led the reclassification of the company’s account from a non-performing asset (NPA) to "standard." Canara Bank and Indian Bank, holding ₹1,600 crore and ₹1,000 crore in loans, respectively, also supported the restructuring.

From the initial tranche, RINL allocated ₹450 crore to principal repayments, ₹85 crore to interest payments, and ₹300–400 crore to buyers’ credit repayment, while ₹700 crore was earmarked for fixed deposits and financial commitments.

The next tranche of ₹1,400 crore is expected in April 2025, followed by ₹800 crore each in July and October, as RINL continues its financial restructuring efforts.

News by Rahul Yelligetti.