Visa Steel Ltd will sell new shares to fund INR 17 billion expansion and cut debt,as it tries to end six straight quarters of losses.
Mr Vishambhar Saran chairman of Visa Steel Ltd said that the sale at the right price will reduce the founders holding to 51%from 74%.
Visa,which shut its sole steel plant in the eastern state of Odisha early this year because of an iron ore shortage,is banking on the local government to lift curbs and resume supplies of the raw material by January.
Mr Saran said that"The next year will be a profitable year.We're incurring costs without running the plant,which is the main reason for the losses.Odisha's move to ensure iron ore for local steelmakers will help us restart the plant."
Mr Saran said that with the steel plant out of commission,Visa has focused on selling ferrochrome,used to rust-proof steel and coke used in blast furnaces.Visa,which consumed almost a third of its own coke output,is now selling its entire production to rival mills.
He said that"We're ramping up ferrochrome and coke output,both of which have a good market."