Vizag Steel is profitable again. The privatisation question hasn't gone away.
RINL posted a ₹54 crore profit in January after a ₹11,440 crore central package and a return to full blast furnace operation.
Rashtriya Ispat Nigam Limited — Visakhapatnam Steel Plant to everyone in Andhra Pradesh — has returned to profit. The company reported a ₹54 crore profit in January 2026, against a loss of ₹486 crore in September 2024.
For a plant that was, not long ago, discussed primarily in the language of disinvestment, that is a substantial reversal.
What changed
The Union Cabinet approved a revival package of ₹11,440 crore, comprising ₹10,300 crore of equity infusion and the conversion of working capital loans into 7 per cent non-cumulative redeemable preference shares.
The operational effect was immediate and mechanical. With working capital available, the plant could buy raw material; with raw material, it could fire all three blast furnaces. Hot metal production rose to 19,401 tonnes per day, against 9,215 tonnes per day in the second quarter of 2024–25 — more than double. Capacity utilisation reached a record 94 per cent.
RINL’s credit rating has improved accordingly.
The structural problem underneath
The turnaround is real, but it is worth being precise about what caused it. RINL’s core difficulty has never been that its plant was bad. It is that RINL is the only major integrated steel producer in India without a captive iron ore mine.
That means buying ore at market prices while competitors mine their own — a permanent cost disadvantage of several thousand rupees a tonne that no amount of operational discipline eliminates. When steel prices are strong, RINL can be profitable. When they fall, the disadvantage reasserts itself.
A ₹11,440 crore infusion solves a liquidity crisis. It does not solve a structural one.
The politics
The plant employs thousands directly and anchors an industrial ecosystem across Visakhapatnam. Proposals to sell the government’s stake have met sustained resistance from unions and across the state’s political spectrum, and the issue cuts across party lines in a way few others in Andhra Pradesh do.
The revival package has, for now, taken the immediate argument off the table. It has not resolved it. A profitable RINL is a more attractive asset to sell, not a less attractive one — a point its unions have made.
What to watch
Three things. Whether the profit sustains across a full financial year rather than a strong month. Whether a captive mine allocation materialises, which would change the company’s economics permanently. And whether the government treats the turnaround as vindication of public ownership or as preparation for exit.
Those are not the same outcome, and the difference will be visible in what happens after the next few quarterly results rather than in the results themselves.