Early in FY24, NMDC Steel’s privatization is expected to be complete.

The Center will shortly launch a financial bid process for the privatization of NMDC Steel with a goal of concluding the deal in early 2023–2024. The share price of NMDC Steel increased 4.88% to settle at Rs 33.3 on Tuesday after going public at Rs 30.25 on Monday. The Centre’s 60.79% stake was valued at roughly Rs 6,000 crore at the time of writing. Yet given the intense bidding procedure that included some of the leading domestic and international steel corporations, the strategic sale is anticipated to bring in significantly more money than the market share price indicates.

Around Rs 22,000 crore has already been spent by NMDC on the construction of the new facility. Physical work projects like excavation, concreting, structure fabrication, and equipment supply activities have already made significant progress. Since the facility is expected to be finished in March 2023, there is less risk associated with its implementation.

On January 27, the Center received several expressions of interest (EoIs) for its 50.79% ownership in the NMDC Steel Ltd (NSL) factory in Nagarnar, Chhattisgarh, which is still under development. In addition, after the strategic buyer has been found through the bidding procedure, the Centre will offer NMDC a 10% interest in NSL. NSL would be the second steel company to be divested after Neelachal Ispat Nigam Ltd. (NINL), situated in Odisha and jointly held by four central PSUs and two Odisha government PSUs for Rs. 12,100 crore in January 2022 to Tata Group.

Following the demerger process, NSL will have the same shareholding as NMDC, which is comprised of 60.79% of the shares owned by the Center and 39.21% by the general public. Only those prospective bidders who are determined to meet the eligibility requirements will be permitted to take part in the transaction’s next stage, which comprises thorough due diligence and the filing of financial bids.

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