Visakhapatnam Steel Plant moots monetisation of its properties across India to improve liquidity

The total market value of these assets, spread across Mumbai, Delhi, Chennai, Bengaluru, Hyderabad and Pune, is ₹476.18 crore; it is a conspiracy to undermine RINL-VSP, says activist J. Ayodhya Ram

Published - June 20, 2024 10:20 pm IST - Visakhapatnam

An aerial view of the Visakhapatnam Steel Plant. The plant is currently going through financial difficulties.

An aerial view of the Visakhapatnam Steel Plant. The plant is currently going through financial difficulties. | Photo Credit: File photo

At a time when coalition governments of the National Democratic Alliance (NDA) both in the State and at the Centre are assuring that they would help the Visakhapatnam Steel Plant (RINL-VSP) emerge from its ongoing financial difficulties, the steel plant’s management is believed to have embarked on a plan of selling the company’s outstation properties across the country to generate some funds.

In-principle clearance is said to have been accorded for selling RINL-VSP properties in cities like Mumbai, Chennai, Hyderabad, Bengaluru and Delhi.

According to reliable sources in RINL-VSP, the primary purpose of the proposed monetisation drive is to improve liquidity by generating at least ₹476.18 crore as per the present market value. Keeping in view the current liquidity challenges, the independent directors (of Marketing and Finance among other departments) suggested the board that the monetisation process be expedited without any delay.

The properties identified for monetisation are: an office building in Mumbai with an area of 214 sq metres with an approximate market value of ₹12.51 crore, seven flats in Goregoan East, Mumbai, with a combined area of 528 sq m and a market price of ₹10.91 crore, four flats in Koperkhairane with an area of 261 sq m and a market price of ₹2.90 crore, two flats in Kalamboli of Mumbai with an area of 108 sq m and a market price of ₹61 lakh, an office building in Bhikaji Cama Place, New Delhi, with an area of 350 sq m and a market price of ₹16 crore, an office building in Faridabad (186 sq m, ₹1.42 crore), an office building in Hyderabad (1 acre, ₹12.15 crore), office building in Bengaluru (424 sq m, ₹6.50 crore) a stock yard in Chennai (13.2 acres, market value of ₹191.73 crore), a stock yard in Hyderabad (22 acres, at ₹220 crore), and lastly an office building in Pune priced at ₹1.45 crore.

The total market value of all assets combined is ₹476.18 crore.

RINL purchased the large land parcels in Hyderabad and Chennai for storing steel material and using them as stockyards. The Hyderabad property was purchased from the then undivided AP Industrial Corporation at Velumala in Medak in 1991. Nearly 4.5 lakh tonnes per year of steel was being handled through this stockyard, which served Central and Western India, apart from Telangana.

Similarly, the property in Chennai was purchased from M/s Chennai Metropolitan Development Authority, Tamil Nadu, in Sathangadu in 1987. Nearly three lakh tonnes of steel per year was being handled through this stockyard. It catered to the needs of South India.

Speaking to The Hindu, RINL-VSP Ukku Porata Committee convener J. Ayodhya Ram, said, “The stock yards at Hyderabad and Chennai have been playing a vital role for RINL in selling steel for the last three decades. After learning about all the proposals for monetisation of such valuable assets across the country, we strongly believe that there is a high-level conspiracy to completely undermine RINL-VSP, which is Andhrula Hakku (right of Andhrites). Instead of saving the plant from its financial crisis, the authorities concerned including politicians at the Cabinet levels are toying with the sentiments and interests of the steel plant employees, their families and the people of this vicinity. We will not tolerate this.”

When contacted, an RINL-VSP management official, on condition of anonymity, said: “Proposals of monetisation of properties may be true, but nothing is concrete yet and the process is still in a nascent stage.”

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