RINL secures ₹7,000 crore Phase 1 funding as banks ease interest rates for revival.

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

RINL had been servicing loans at high interest rates of 10–11.5%, prompting calls for a revision to facilitate its financial turnaround. Union Steel Minister HD Kumaraswamy has advocated for lower rates in multiple meetings, and in February, RINL’s CMD formally requested the State Bank of India (SBI) to bring interest rates in line with industry norms, between 7% and 7.75%.

Following the funding, RINL has returned to profitability, reporting a gross margin (EBITDA) of ₹55 crore in January 2025, a significant recovery from a ₹300 crore EBITDA loss in the same period last year.

SBI holds the largest exposure to RINL, with over ₹5,000 crore in loans, including capex and working capital, followed by Canara Bank (₹1,600 crore) and Indian Bank (₹1,000 crore). With SBI leading the charge, banks have now reclassified RINL’s account as "standard," reversing its earlier classification as a non-performing asset (NAP).

From the first tranche of funds, RINL allocated ₹450 crore toward principal loan repayments, ₹85 crore for interest payments, and ₹300-400 crore for buyers’ credit repayment. An additional ₹700 crore was set aside for fixed deposits and other financial obligations.

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

HBL