JSW Steel Ltd. is seeking to form a consortium to bid for a majority stake in Teck Resources Ltd.’s steelmaking coal business, sources said. This will potentially rival an Rs 66,400 cr ($8 billion) offer from commodities company Glencore Plc.
Mumbai-based JSW is seeking partners for an offer to acquire 75% interest in the said company, known as Elk Valley Resources Ltd., as per the reports said. This marks a shift from a July report, when Bloomberg News reported JSW was interested in up to up to 20% of Teck’s coal business.
JSW Steel is seeing expansion within and with outside opportunities to take its 27MT capacity currently to 37.8MT by March 2025, 50MT by March 2027 and 75MT by March 2030. Management also pegged the expansion costs to come around Rs 48,852 cr to be deployed gradually.
Group shifting focus on green energy, steel to meet Net Zero targets
• JSW Cement’s green journey started with using slag from steel plants and fly ash from thermal power stations as the company looking to stop using limestone and its mining.
• Group is in the middle of a debt-funded Rs 85,000 cr capital expenditure cycle that will go on till March 2025. Total liabilities of JSW Steel stands at Rs 144,063 cr (as of Mar 31, 23). Profit came in at Rs 4,139 cr vs Rs 20,938 cr in FY22.
• Competition arising with ArcelorMittal and Nippon Steel jointly buying Essar Steel for Rs 42,000 cr. AM/NS India’s is investing Rs 60,000 cr to expand Hazira capacity to 15MT. Odisha government recently approved AM/NS India’s proposal to set up a 7MT plant in Jagatsinghpur district.
| Group firms | Revenue | Profit | Total Debt | Cash and Bank Balances | ||||
| (In Rs Crs) | FY17 | FY23 | FY17 | FY23 | FY17 | FY23 | FY17 | FY23 |
| JSW Steel | 55,604 | 166,990 | 3,523 | 4,139 | 43,334 | 55,170 | 1,485 | 18,716 |
| JSW Energy | 8,263 | 10,867 | 629 | 1,480.12 | 14,349 | 6273.62 | 784 | 345.17 |
| JSW Cement | 1,413 | 4,863.48* | 111 | 232.65* | 1,789 | 4,622 * | 126 | 164.83* |
| JSW Infra. | 888 | 2,273* | 310 | 321* | 1,599 | 1,323* | 45 | 1,052* |
| JSW Paints | NA | 1,060* | NA | -119* | NA | 726* | NA | 3* |
Group foraying into other verticals to assure the group’s targets are met
• JSW Energy aims to increase share of renewables from 25% to 85%. It will rise to 65% with addition of 1,750 MW from recently acquired Mytrah Energy (for Rs 10,530 cr) and 2,500 MW under-construction wind and hydro projects.
• Forayed into the paints business with plans to expand production from 1.5 lakh to 7 lakh kilolitres by 2030 with investments worth Rs 2,500 cr.
•JSW Infrastructure: Increasing operational capacity of ports and terminals from 153 MT to 300 MT by 2030 with investment of Rs 20,000 cr
• JSW Cement: Company aim to increase capacity from 17MT to 50MT by 2030 with investments of Rs 30,000 cr.