NINL seeks to get back into the black, eyes net profit 2019-20 onwards

PSU steel maker posts operating profit during April-August period, following successful blast furnace capital repair; Ebitda turns positive

Public sector steel maker Neelachal Ispat Nigam Ltd (NINL), jointly promoted by MMTC Ltd and two Odisha government-controlled entities, aims to slip out of the red and log net profit in 2019-20.

Following a successful blast furnace capital repair running into over four months, NINL clocked operating profit during April-August period of this fiscal. The steel maker turned Ebitda (earnings before interest, taxes, depreciation and amortisation) positive, recovering dramatically from its Ebitda negative status in FY18.

With growth in production, rolling out of steel billets (a value-added product), conversion of part of billets into TMT, wire rods and mining from its captive iron ore asset, the company aims to turn net profit in the next fiscal. NINL, the country's leading leading pig iron producer cum exporter, runs a 1.1 million tonne (mt) steel plant at Duburi inside the Kalinganagar industrial complex, touted as Odisha's  steel hub.

Buoyed by the capital repair work on its blast furnace, NINL posted its best ever Q3 production of 0.53 million tonnes in hot metal. At 0.36 mt, its half-yearly hot metal output went past the previous highs. In the month of December alone, NINL rolled out 85090 tonnes of hot metal, its highest monthly output ever.

S S Mohanty, vice-chairman & managing director, NINL, said, “The production growth is most significant for the turnaround of the company. The next target is production of value added billets, conversion of part of the billets into TMT, wire rod and operation of the captive mines towards the start of the next fiscal which will strengthen the company’s bottom-line.”

NINL said, in calendar 2018, it hit two milestones- successful completion of blast furnace capital repair work and commencing billet production by restarting the Steel Melting Shop (SMS). It has listed captive iron ore mining slated to start in next fiscal, as the company's third milestone.

MMTC is the biggest equity participant in NINL with a shareholding of 49.9 per cent. The Odisha government's ownership in the steel PSU is through two of its undertakings -- Odisha Mining Corporation (OMC) and Industrial Promotion & Investment Corporation of Odisha Ltd (Ipicol).