State-run RINL's issue was slated to hit the domestic market on 3rd July and kick-start the ambitious disinvestment process of the government for the current fiscal
New Delhi: Considering volatile market conditions, the Rs2,500-crore initial public offering (IPO) of state-run Rashtriya Ispat Nigam Ltd (RINL) has been delayed by at least three weeks on advice of its merchant bankers UBS Securities India and Deutsche Equities (India) that early July launch of the issue may not yield desired results, reports PTI.
"The RINL IPO has been delayed by three weeks. Merchant bankers for the issue have stated the government that time is not conducive now for the issue to hit the market due to the volatile market conditions. All proposed roadshows have also been deferred," a source in the government told PTI.
A top company official said the pre-marketing roadshows, which were to be started with Mumbai from Tuesday, have been cancelled for the time being, but department of disinvestment is yet to communicate the company any fresh time-line.
The RINL issue, was slated to hit the domestic market on 3rd July and kick-start the ambitious disinvestment process of the government for the current fiscal. The postponement of the issue is a bad start to the Rs30,000 crore disinvestment target that the government has set for the current fiscal.
"Merachant bankers are of the view that attempting the issue amidst the volatile conditions would not result in getting strong reception for the transaction," he said.
The successful journey of the issue in domestic bourses was critical for the government to line up other issues to meet the Rs30,000 crore target and aim to bring down the widening fiscal deficit.
The two merchant bankers of the issue -- UBS Securities India and Deutsche Equities (India) -- have recently suggested the government to delay the launching of the issue by three weeks with the hope that the domestic market would look up by then with the strengthening of rupee and softening of crude oil prices.
The BSE 30-share benchmark Sensex has dipped over 13% since 21st February on a volley of reasons including higher interest rates and poor showing of the economy in the backdrop of policy paralysis. The metal index also witnessed drastic fall during the same period.
In line with the earlier schedule, RINL had filed draft red herring prospectus (DRHP) with the market regulator SEBI on 18th May and overseas roadshows to woo investors were to start from 21st June.
"The objects of the offer are to carry out disinvestment of 48.9 crore equity shares by the selling shareholder and to achieve the benefits of listing the equity shares on the stock exchanges. Our company will not receive any proceeds from the offer and all proceeds shall go to the selling shareholder," RINL said in the DRHP.
The Cabinet Committee on Economic Affairs in January had approved disinvestment in RINL. The government aims to raise Rs2,500 crore by divesting 10 per cent stake out of its 100 per cent holding in the company.
The National Green Tribunal rejected IL&FS Tamil Nadu Power Co's plea saying a rapid cumulative impact assessment study can be completed before the onset of monsoon
New Delhi: The National Green Tribunal has refused to stay its order suspending environment clearance granted to IL&FS Tamil Nadu Power Company Ltd for its 3,600MW thermal power plant in the state's Cuddalore district, reports PTI.
The Tribunal rejected IL&FS' fresh plea for keeping its 23rd May order for suspension of the environment clearance (EC) in abeyance and to allow it to carry out construction works for the project.
The tribunal had suspended the 31 May 2010 EC on 23rd May this year and had directed the Ministry of Environment and Forests (MoEF) to review its decision based on a cumulative impact assessment study and stipulate additional environmental conditions, if required.
Infrastructure Leasing & Financial Services Ltd (IL&FS) had sought a stay on the Tribunal's 23rd May order contending that preparatory civil works like construction of storm water drainage and levelling of the site must be completed before the onset of monsoon in mid September 2012.
The tribunal rejected its plea saying a rapid cumulative impact assessment study can be completed before the onset of monsoon and "civil works referred to by IL&FS may not take very long to complete if planned and executed properly".
"In view of the importance of cumulative impact study in decision making, in the case on hand and the logistic reasons with regard to completing the civil works, we see no reason to provide relief as sought in the application," a bench headed by Tribunal Acting Chairperson Justice AS Naidu said.
Essar Oil has invested over Rs10,000 crore to expand capacity at its Vadinar refinery to 20 mt, or 405,000 barrels per day
Mumbai: Ruias-promoted Essar Oil on Tuesday announced completion of its Rs10,000-crore expansion project, four months ahead of schedule, at the Vadinar refinery in Gujarat, taking the annual capacity to 20 million tonne, reports PTI.
Completion of the optimisation project marks the end of the capex cycle and we are now geared to enjoy significant upside in margins. The Vadinar refinery accounts for about 10% of the country's refining capacity, Essar Oil, which is the country's second largest private refiner, said in a statement.
"We are very happy to announce the completion of our optimisation project much ahead of the schedule. With this commissioning, our capex cycle has now come to an end and we are fully geared to deliver the value of our investments to all our stakeholders," Essar Oil Managing Director and Chief Executive Lalit Gupta said in a statement.
The company has invested over Rs10,000 crore to expand capacity to 20 mt, or 405,000 barrels per day, which will improve complexity to 11.8.
This takes the total investment into the Vadinar facility to around Rs 24,000 crore, the company said, adding that the capital cost at Vadinar refinery is only half the global average for capacity creation.
Prior to expansion, the facility had 10.5 mt capacity and by 29 March 2012 this rose to 18 mt, involving an investment of Rs9,100 crore. But the optimisation project, involving an additional Rs1,700 crore capex, took the total capacity to 20 mt and investment to around Rs24,000 crore.