AP Govt. permits conversion of power dues by RINL to APEPDCL into share capital

Andhra Pradesh Government has approved the conversion of dues to the tune of ₹2400 crore by Rashtriya Ispat Nigam Limited (RINL) to AP Eastern Power Distribution Company Limited (RINL) into 7%

non-cumulative redeemable preferential share capital after 10 years

Secretary, Industries & Commerce N. Yuvaraj said in an order that as part of support of State Government on all fronts towards RINL revival, they have consented the proposal of Ministry of Steel for conversion of past arrears and upcoming dues of power charges of RINL to APEPDCL over the next two years, amounting to ₹2400crore (including ₹753.29 crore as charge due) into 7% non-cumulative redeemable preferential share capital after 10 years, as a "State support measure towards the revival of RINL."

In GO Ms. No. dated October 14, it was stated that

RINL, the corporate entity of Visakhapatnaman Steel Plant, is a Schedule-A CPSE under the administrative control of Ministry of Steel which has a production capacity of 7.3 million tonnes per annum of liquid steel.

The main areas of activity of RINL are iron and steelmaking with finished products such as billets, wire rods, rebars, rounds, squares, channels, angles and pig iron. RINL is an unlisted company and the

Government of India (GoI) holds 100 percent of the shareholding.

RINL started incurring losses since 2015-16 (except for the years 2018-19 and 2021-22 when it made nominal profits of ₹96.71 crore and ₹913.19 crore respectively.

The Secretary, Ministry of Steel had earlier informed that the support of the State Government would go a long way in helping RINL to tide over the crisis and requested to consider the extend the supporting order to help RINL sustain its operation till its revival as a going concern:

The Centre early this year had unveiled ₹11,440-crore revival package to prevent RINL from brink of closure.

Among others, deployment of State level security to RINL on free of cost basis, preferential purchase of steel from RINL for all projects of State

Government, waiver of RINL’s power and water bills for a period of three years, were sought by the AP Government.

In response, the State Government informed the

Secretary, Ministry of Steel, that the State Government will

provide all the support for the efforts of the Ministry of Steel and RINL in reviving

the company from its present status to a financially strong organization operating to its full installed capacity. Accordingly, all the requests of GoI and RINL have been passed-on to respective departments for their compliance, the GO stated.

Accordingly, the State Government approved for deployment of 167 APSPF police personnel RINL free of cost, w.e.f. 01.05.2025 with cost implication of its full installed capacity with cost implication of Rs.19,72,02,432

towards recurring charges for one year and Rs.7,02,432 for non-recurring charges, aspart of State support in the RINL revival package.

Further, on the request of RINL to convert the power dues since August, 2024 for next two years (for a total amount of Rs.2,400 crore) into non cumulative redeemable preferential share capital after 10 years at 7% interest rate, the APEPDCL. while processing the request, represented to

State Government and RINL to consider to provide the share capital at 10.5% interest rate instead of proposed 7% interest rate.

The APEPDCL later informed that the outstanding CC charges from August, 2024 till September 2025 is about Rs.1,164.31 crore.

After careful consideration, the State Government gave its consent on the proposals of Ministry of Steel and RINL to keep it as a going concern and put it back on the right track, an official connected with RINL revival, said.