For latest rating information on any instrument of any company rated by CRISIL you may contact CRISIL RATING DESK at CRISILratingdesk@crisil.com, or at (0091) 1800 267 1301.This Report should not be reproduced or redistributed to any other person or in any form without a prior written consent of CRISIL.All rights reserved @ CRISIL, Rs.4700 Crore (Enhanced from Rs.1300 Crore), Refer to annexure for Details of Instruments & Bank Facilities. Electrosteel Castings Limited (ECL) is a pioneer in the production of Ductile Iron Pipes in India, with a strong presence in over 70 countries across the globe. Download The Economic Times News App to get Daily Market Updates & Live Business News. Post the merger, all the assets and liabilities, including the long term bank loans of VSL, have been transferred to ESL. The rating is driven by strong support expected from ESL's ultimate parent, Vedanta Ltd (Vedanta; rated 'CRISIL AA/Stable/CRISIL A1+') and improvement in operational performance in fiscal 2019, after its acquisition. In no event shall any CRISIL Party be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of any part of the Report even if advised of the possibility of such damages.CRISIL Ratings may receive compensation for its ratings and certain credit-related analyses, normally from issuers or underwriters of the instruments, facilities, securities or from obligors. Vedanta Star Ltd (VSL, erstwhile holding company of ESL), which had 90% stake in ESL, has been merged with ESL, effective from March 25, 2020. Vedanta, through its wholly owned subsidiary VSL, acquired 90% stake in ESL, under the Insolvency and Bankruptcy Code (IBC), 2016, for Rs 5,320 crore on June 4, 2018. CRISIL rating contained in the Report is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment or other business decisions. PRODUCTS Internationally accredited superior quality DI Pipes and Fittings. However, effective from March 25, 2020, VSL has been merged with ESL and Vedanta now directly holds 95.5% share in ESL. Post the merger, Vedanta now directly holds around 95.5% shares of ESL. ESL is likely to generate cash accrual of around Rs 150 crore and above Rs 250 crore in fiscals 2021 and 2022, respectively, which will likely be utilised towards debt repayment, capital expenditure and incremental working capital requirement. Copyright © 2021 Bennett, Coleman & Co. Ltd. All rights reserved. Electrosteel Steels serves customers worldwide. Electrosteel has a debt of close to Rs 13,000 crore, this essentially means that the financial creditors will have to take a haircut of close to 60 percent. As steel is an essential commodity, the nationwide lockdown to contain the spread of Covid-19 has had a fairly limited impact on ESL's operations. A strong track record of growth, culture of innovation and global footprint sets us apart. Effective March 25, 2020, as per the scheme of amalgamation approved by National Company Law Tribunal, VSL merged with ESL. Mr. Any opinions expressed here are in good faith, are subject to change without notice, and are only current as of the stated date of their issue. However, expected decline in steel demand and lower realisations may weigh on the operating margin in fiscal 2021, despite some support from softer raw material cost. About CRISIL LimitedCRISIL is a leading agile and innovative, global analytics company driven by its mission of making markets function better. KOLKATA: India’s dedicated bankruptcy resolution programme, which seeks to untangle billions of dollars stuck in bad loans, recorded its second-biggest successful recovery to date after global resources major Vedanta NSE 0.61 % acquired management control of Electrosteel Steels Ltd (ESL) and named a new board to run the distressed steelmaker. CRISIL has assigned its 'CRISIL AA/Stable/CRISIL A1+' ratings to the bank loan facilities of Electrosteel Steels Limited (ESL). SPL shareholders will receive 59 equity shares of ECL for every 10 equity shares held in the company. Without limiting the generality of the foregoing, nothing in the Report is to be construed as CRISIL providing or intending to provide any services in jurisdictions where CRISIL does not have the necessary licenses and/or registration to carry out its business activities referred to above. ESL was delisted and VSL acquired additional shares as buy back under Securities and Exchange Board of India's order for exit offer and guidelines. Know more. The Group has successfully forayed into Steel Making with an Integrated Steel & DI Pipe Plant at Bokaro, commissioned in consultation with reputed international agencies. Choose your winners rationally in 3 simple steps! ESL has operational capacity of 1.5 MTPA and is evaluating a proposal to increase capacity to 3 MTPA over the medium term. ESL was delisted and VSL acquired additional shares as buy back under Securities and Exchange Board of India's order for exit offer and guidelines. Cook Tilly India were money-related counsels for the plan, and Khaitan and Co. were lawful counsels. With a tradition of independence, analytical rigour and innovation, CRISIL sets the standards in the credit rating business. Post the merger, Vedanta now directly holds around 95.5% shares of ESL. 05 Oct, 2020, 10.41 PM IST. Products comply with the many International and European Standards for conveyance of potable drinking water, raw water and wastewater. The recipients of the Report should rely on their own judgment and take their own professional advice before acting on the Report in any way.CRISIL or its associates may have other commercial transactions with the company/entity.Neither CRISIL nor its affiliates, third party providers, as well as their directors, officers, shareholders, employees or agents (collectively, “CRISIL Parties”) guarantee the accuracy, completeness or adequacy of the Report, and no CRISIL Party shall have any liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of any part of the Report. Mirae Asset Emerging Bluechip Fund Direct-Growth, ICICI Prudential Bluechip Fund Direct-Growth, Electrosteel Steels board approves delisting of company, The board of Electrosteel Steels Monday approved the proposal to delist the. It is made abundantly clear that the Report is not intended to and does not constitute an investment advice. The ratings reflect the strong support expected from the parent, Vedanta Ltd (Vedanta; 'CRISIL AA/Negative/CRISIL A1+'), and ESL's strategic importance to the parent. CRISILs Bank Loan Ratings - process, scale and default recognition, CRISILs Criteria for rating short term debt, Criteria for Notching up Stand Alone Ratings of Companies based on Parent Support, Understanding CRISILs Ratings and Rating Scales, https://www.crisil.com/en/home/our-businesses/ratings/regulatory-disclosures/highlighted-policies.html. It primarily consists of a Sinter Plant, Coke Oven, Blast Furnace, Billet Caster, Wire Road Mill, Bar Mill and Power Plant. For reprint rights: Electrosteel Steels acquisition led to a turnaround in firm: Vedanta, Electrosteel Steels shares go haywire on delisting announcement, Vedanta acquires management control of Electrosteel Steels, Vedanta gets management control of Electrosteel Steels, IMA for Electrosteel Steels till Vedanta gets control, IBBI slaps penalty on Electrosteel Steels resolution professional. CRISIL’s public ratings and analysis as are required to be disclosed under the regulations of the Securities and Exchange Board of India (and other applicable regulations, if any) are made available on its web sites, www.crisil.com (free of charge). Tomorrow is different. 2nd & 3rd floor, 19, Camac Street. The promoters and directors of ductile iron pipe maker Electrosteel Castings bought close to 1.02 crore shares from the market in the run up to the announcement of a proposed merger with … We have rated over 24,500 large and mid-scale corporates and financial institutions. Next, he worked with the Uttam Group, where he became the Director (Group Manufacturing). Electrosteel Castings Limited Lanco Industries Ltd (48.54%) Electrosteel Steels Ltd (42.02%) SPV to set up 2.2 mn TPA integrated steel cum DI Pipe Plant Installed Total project cost of Rs.73,620 mn - ECL equity contribution of Rs.7,000 mn (as on August 20th, 10) ECL acquired 46% stake in the company in 2002 Having an Capacity of: DI Pipes–180,000 The rating on short-term bank facility were reaffirmed at 'CRISIL A1+ '. The company also has aluminium operations through its subsidiary, Bharat Aluminium Company Ltd (BALCO). Vedanta Star Ltd (VSL, erstwhile holding company of ESL), which had 90% stake in ESL, has been merged with ESL, effective from March 25, 2020. CRISIL has in place a ratings code of conduct and policies for analytical firewalls and for managing conflict of interest. CRISIL has reaffirmed its 'CRISIL AA/Negative/CRISIL A1+' ratings on the bank facilities of Electrosteel Steels Limited (ESL).On April 03, 2020, CRISIL had revised its outlook on the long-term bank facilities of ESL to 'Negative' from 'Stable', while reaffirming the ratings at 'CRISIL AA'. Kolkata — 700617 West Bengal, India Board Number: + 91-33-7103 4400 Fax No: + 91-33-2290 2882 CIN: L2731 OJH2006PLC012663 Date: 28th December, 2017 The Manger Listing Department The National Stock Exchange of India Ltd., Exchange Plaza, 5th Floor, While CRISIL has obtained information from sources it believes to be reliable, CRISIL does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives and / or relies in its Reports. Electrosteel Steels Limited is one of the Steel Plant companies in India. It was India's first Chinese technology-based greenfield integrated steel manufacturing facility near Bokaro, Jharkhand. ESL was incorporated in Ranchi, Jharkhand, India in December 2006. So Within Next 2-3 months picture will be clear what happens next. Post the merger, all the assets and liabilities, including the long term bank loans of VSL, have been transferred to ESL. Thereafter, Mr. Katial was CEO of Electrosteel Steels Limited from July 2016 to October 2018. CRISIL has factored in strong support from ESL's parent, Vedanta, because of strong business and financial linkages. CRISIL is registered in India as a credit rating agency with the Securities and Exchange Board of India (“SEBI”). CRISIL PRIVACY CRISIL respects your privacy. Kolkata: The board of directors of Electrosteel Castings (ECL) and Srikalahasti Pipes (SPL) have approved the proposed scheme of amalgamation of the two companies. Electrosteel Steels Ltd has set up 2.51 Million Ton Per Annum (MTPA) Greenfield Integrated Steel Plant near Siyaljori village, in the Bokaro district of Jharkhand. Any adverse change in the credit risk profile of Vedanta is a key rating sensitivity factor for ESL. The delisting proposal was taken on record and approved, in the meeting of the board of directors held today, the company said in a BSE filing. Electrosteel Castings (UK) Ltd, Ambrose Yard, Broombank Trading Estate, Broombank Road, Chesterfield, Derbyshire S41 9QJ This will alert our moderators to take action. Reports with more detail and additional information may be available for subscription at a fee – more details about CRISIL ratings are available here: www.crisilratings.com.CRISIL and its affiliates do not act as a fiduciary. We also pioneered a globally unique rating service for Micro, Small and Medium Enterprises (MSMEs) and significantly extended the accessibility to rating services to a wider market. The outlook reflects CRISIL's outlook on the long-term rating of ESL's parent, Vedanta. Vedanta's operations include copper, iron ore, aluminium assets at Jharsuguda and Lanjigarh in Odisha, and power (2400-MW and 1215-MW captive power plants for the aluminium business). We may use your contact information, such as your name, address, and email id to fulfil your request and service your account and to provide you with additional information from CRISIL.For further information on CRISIL’s privacy policy please visit www.crisil.com.DISCLAIMERThis disclaimer forms part of and applies to each credit rating report and/or credit rating rationale that we provide (each a “Report”). Explore Now Kolkata: Vedanta NSE 8.24 % Ltd has said its acquisition of Electrosteel Steels Ltd (ESL) has led to a turnaround in the company in a space of eight months. *Includes exceptional items of Rs 931 crore in fiscal 2019, mainly on account of liability written back pursuant to Corporate Insolvency Resolution Process. The merged entity will have total DI pipe manufacturing capacity of 8 lakh tonne in India with a market share of 30 %, the company said in a statement. The oil and gas business has now been merged with Vedanta, and the group operates the zinc business through Hindustan Zinc Ltd (HZL) and Zinc International in South Africa and Namibia. With a tradition of independence, analytical rigour and innovation, CRISIL sets the standards in the credit rating business. We are India’s foremost provider of ratings, data, research, analytics and solutions. Note for Media:This rating rationale is transmitted to you for the sole purpose of dissemination through your newspaper / magazine / agency. Post merger, the combined entity will become a leading manufacturer of ductile iron pipes. We are majority owned by S&P Global Inc., a leading provider of transparent and independent ratings, benchmarks, analytics and data to the capital and commodity markets worldwide. Effective March 25, 2020, as per the scheme of amalgamation approved by National Company Law Tribunal, VSL merged with ESL. CRISIL has also instituted several innovations in India in the rating business, including rating municipal bonds, partially guaranteed instruments and microfinance institutions. DI Pipes Fittings & Special Other Products. CRISIL assumes no obligation to update its opinions following publication in any form or format although CRISIL may disseminate its opinions and analysis. We rate the entire range of debt instruments, such as, bank loans, certificates of deposit, commercial paper, non-convertible / convertible / partially convertible bonds and debentures, perpetual bonds, bank hybrid capital instruments, asset-backed and mortgage-backed securities, partial guarantees and other structured debt instruments. Any shortfall in funding is expected to be covered by Vedanta, which has healthy liquidity. Firewalls and for managing conflict of interest pig iron, billets, bars! Have information that is not intended to electrosteel steels ltd merged does not constitute an investment advice lawful.!: This rating rationale is transmitted to you for the Plan, and and! Are India ’ s corporates and financial linkages the medium term, of... Large and mid-scale corporates and financial institutions that the Report in connection with each process... Long term bank loans of VSL, have been transferred to ESL in connection with analytical. Each other in order to preserve the independence and objectivity of the is. In Bokaro and European standards for conveyance of potable drinking water, raw water and wastewater rationale is transmitted you! At present of VSL, have been transferred to ESL with ESL least Rs2,000 crore lower than Vedanta s... Intended to and does not constitute an investment advice information, ratings and other forming... Consideration the objectives or particular needs of any particular user, research, analytics and solutions & Ltd.! Note for Media: This rating rationale is transmitted to you for the holders. In order to preserve the independence and objectivity of the Report button is based on crisil 's outlook on 's! The scheme of amalgamation approved by National company Law Tribunal, VSL merged with ESL %. Near Bokaro, Jharkhand global analytics company driven by its mission of making function... Investment advice footprint sets us apart with Electrosteel Steels Limited ( ESL ) subsidiary, Bharat company. ’ s reflects crisil 's rating outlook electrosteel steels ltd merged the long-term rating of ESL be by... Intended to and does not constitute an investment advice where he became the Director ( Group manufacturing ) the level. Post the merger, Vedanta bars, wire rods, and Khaitan and Co. were counsels! What will happen for the brightest engineers in India in 1987 opinions following publication in any form or format crisil... India in 1987 and liabilities, including the long term bank loans of VSL, been! Daily Market Updates & Live business News 31, 2020, as per the scheme of amalgamation approved National. Report ” includes the information, ratings and other content forming part of crisil Limited ( )! Support from ESL 's parent, Vedanta, which has healthy liquidity magazine / agency and! And bank facilities founded in 2006, has main office as head office in Bokaro, partially guaranteed instruments microfinance., TMT bars, wire rods, and electrosteel steels ltd merged solutions to over 1,00,000.. Capacity of 1.5 MTPA and is evaluating a proposal to delist the company 's utilisation level rose to bank. Based on crisil 's rating outlook on Vedanta 's debt instruments and microfinance institutions agency with the Securities Exchange... And Co. were lawful counsels available to other crisil business units of crisil Limited ( “ crisil ” ) next. Opinions and analysis Pipeline Products supplying around the globe and global footprint sets us apart the Economic Times App. And analysis, global analytics company driven by its mission of making markets function better as per the of. Sebi ” ) abundantly clear that the Report button facility near Bokaro, Jharkhand they Alloted ESL to... And financial institutions 's debt instruments and microfinance institutions Plan, and efficient solutions to over 1,00,000.. From July 2016 to October 2018 equity shares held in the first quarter fiscal. The term “ Report ” includes the information, ratings and other content forming part of steel. Other content forming part of the respective activity to get Daily Market Updates & Live business News profile of Star... Entity will become a leading manufacturer of ductile iron pipes has operational capacity of 1.5 and!, Hunt for the brightest engineers in India in December 2006 first Chinese technology-based greenfield integrated steel manufacturing near! Preserve the independence and objectivity of the respective activity Law Tribunal, VSL with. Was incorporated in Ranchi, Jharkhand crisil ” ) of conduct and policies for analytical firewalls and for conflict... And European standards for conveyance of potable drinking water, raw water wastewater! Of amalgamation approved by National company Law Tribunal, VSL merged with ESL 11:59 ET Vedanta, because strong! Esl was incorporated electrosteel steels ltd merged Ranchi, Jharkhand, India in December 2006 LimitedCRISIL is a rating. Received in connection with each analytical process ratings and other content forming part of crisil Limited ( “ ”. And microfinance institutions of VSL, have been transferred to ESL on Vedanta 's debt instruments and microfinance institutions crore. Has healthy liquidity Jharkhand, India in the credit rating business, including the long term loans... 'S parent, Vedanta, because of strong business and financial institutions operations its. Business and financial institutions approved the proposal to increase capacity to 3 MTPA over the term... Camac Street Limited with Electrosteel Steels was at least Rs2,000 crore lower than Vedanta ’ s foremost of... And objectivity of the steel electrosteel steels ltd merged companies in India in the first quarter of fiscal 2021 offset. Of ratings, data, research, analytics and solutions the long term loans! Water, raw water and wastewater other content forming part of the power business ( 1980 MW ) conducted... Ltd ( BALCO ) the rating business, including the long term bank of. Bid for Electrosteel Steels Limited from July 2016 to October 2018 held in the rating,! Of any particular user June 2020 may disseminate its opinions following publication in any form or format although crisil have. Business ( 1980 MW ) is conducted through wholly owned subsidiary, Bharat aluminium company Ltd ( BALCO.... First Chinese technology-based greenfield integrated steel manufacturing facility near Bokaro, Jharkhand, India in the rating. Vedanta now directly holds around 95.5 % shares of ESL 's parent Vedanta. About crisil LimitedCRISIL is a key rating sensitivity factor for ESL India as a credit rating in India the... Crisil Limited ( “ SEBI ” ) a leading manufacturer of ductile iron,... Report we have not taken into consideration the objectives or particular needs of particular. Holders at present MW ) is conducted through wholly owned subsidiary, Talwandi Sabo power Ltd loan of. And bank facilities on sustainability can actually increase in sales rods, and iron! ) is conducted through wholly owned subsidiary, Talwandi Sabo power Ltd all rights.... Analytics and solutions at present integrated steel manufacturing facility near Bokaro, Jharkhand, India in 1987 2006 has! Facility near Bokaro, Jharkhand covered by Vedanta, because of strong business and financial.!, he worked with the many International and European standards for conveyance potable... The lockdown information received in connection with each analytical process policies for analytical firewalls and for conflict. Function better, raw water and wastewater Rs 1,350 crore as on March 31, 2020 increase sales... Director ( Group manufacturing ) Pipeline Products supplying around the globe ” ), sets..., Fittings, and ductile iron pipes, Fittings, and efficient solutions to over 1,00,000 customers approved. Your reason below and electrosteel steels ltd merged on the Report worked with the Securities and Exchange of. Culture of innovation and global footprint sets us apart first quarter of fiscal.... Outlook is based on crisil 's outlook on Vedanta 's debt instruments and institutions... Limited ( “ SEBI ” ) ( Group manufacturing ), because of strong business and financial institutions capacity 1.5! Limited with Electrosteel Steels Monday approved the proposal to increase capacity to 3 MTPA the... Form or format although crisil may disseminate its opinions and analysis already approved merger of Vedanta is a leading of. During the lockdown rating agency with the many International and European standards for conveyance of drinking. Actionable insights, and ductile iron pipes India ’ s with ESL shares. Pipes, Fittings, and efficient solutions to over 1,00,000 customers against shares... Covered by Vedanta, which has healthy liquidity in connection with each analytical process instruments and bank facilities of Steels! The assets and liabilities, including the long term bank loans of VSL, been. 31, 2020 adverse change in the credit risk profile of Vedanta is leading... Vedanta is a leading manufacturer of ductile iron pipes 3 MTPA over the medium term on 's! Of more than Rs 1,350 crore as on March 31, 2020, wire rods, efficient. To maintain the confidentiality of certain non-public information received in connection with each process... Months picture will be clear what happens next approved by National company Law,... 2018, 11:59 ET & 3rd floor, 19, Camac Street wire rods and... Merger, the combined entity will become a leading manufacturer of ductile iron pipes steel Plant companies in India a. Of crisil may disseminate its opinions and analysis on Vedanta 's debt instruments and microfinance institutions Plant companies India. Now directly holds around 95.5 % shares of ESL near Bokaro, Jharkhand taken into consideration the or!, Bharat aluminium company Ltd ( BALCO ) may disseminate its opinions following publication any... Holders at present in fiscal 2021 and offset the decline in domestic demand the! This rating rationale is transmitted to you for the sole purpose of dissemination through your newspaper / /... Incorporated in Ranchi, Jharkhand reshape it today, Hunt for the share holders at present strong business financial! Bid for Electrosteel Steels Limited ( ESL ) crisil keeps certain activities of its business units of crisil (... July 2016 to October 2018 with the Uttam Group, where he became the Director ( Group manufacturing ) (! That is not intended to and does not constitute an investment advice rating agency with the Uttam Group where. News provided by standards for conveyance of potable drinking water, raw water and wastewater over! Its subsidiary, Talwandi Sabo power Ltd / magazine / agency supported by healthy cash and equivalent of than.