Jindal Stainless Unveils Rs 5,400 Crore Investment Blitz, Targets 4.2 MTPA Capacity Expansion

Jindal Stainless, the country’s largest stainless steel maker, on Wednesday, announced a three-pronged investment strategy worth Rs 5,400 crore as part of its plan to achieve global leadership in stainless steel.

The three-pronged strategy focuses on bolstering the company's melting and downstream capacities. Jindal Stainless has 3 million tonnes of annual melt capacity.

As per an exchange filing, the steelmaker will spend around Rs 1,340 crore for the acquisition of Chromeni Steels Private Limited (CSPL), which owns a 0.6 million tonnes per annum (MTPA) cold rolling mill in Mundra, Gujarat.

Jindal Stainless will pick up a 54 per cent controlling stake that currently belongs to China’s Eternal Tsingshan Group, the world’s largest stainless steel maker. 

The acquisition entails an upfront payment of Rs 1,295 crore to settle the debt, with the remaining Rs 45 crore designated for equity purchase.

The dormant cold rolling mill at Chromeni is slated to resume operations within six months, backed by a capital investment of Rs 100 crore by the company. This move is poised to increase cold rolled products in the company's product mix.

Secondly, the company has earmarked approximately Rs 1,900 crore for expanding its downstream lines in Jajpur, Odisha, to be able to process an increase in melting capacity. Furthermore, nearly Rs 1,450 crore has been allocated for upgrading associated infrastructural facilities.

JV in Indonesia 

This apart, Jindal Stainless will invest around Rs 700 crore for a joint venture (JV) for developing and operating a stainless steel melt shop (SMS) in Indonesia with an annual production capacity of 1.2 MTPA.

This strategic move will catapult the company's melting capacity by more than 40 per cent, reaching a total of 4.2 MTPA.

For the Indonesian SMS venture, Jindal Stainless' Singapore-based subsidiary has forged a partnership with Zenith International Capital Pte Ltd - an entity affiliated with the Eternal Tsingshan Group.

"Investment in upstream facilities in Indonesia is a plug-and-play model which can be expected to get operational in the next 24 months given the existing industrial park facilities at the site," Tarun Kumar Khulbe, CEO of Jindal Stainless said, adding, "logistics and power costs render Indonesia even more favourable to such investments."