Jindal Stainless Ltd (JSL) has announced the acquisition of the remaining 46% equity stake in Chromeni Steels Private Ltd (CSPL) for Rs 278 crore, making CSPL a wholly-owned subsidiary of JSL. Previously, JSL had acquired a 54% stake in CSPL through an indirect acquisition deal worth Rs 1,340 crore. This latest purchase brings the total investment in CSPL to approximately Rs 1,618 crore.
This acquisition is poised to elevate JSL up the value chain and better leverage the rising domestic demand for stainless steel, which is growing at an annual rate of 7-9%. JSL CEO Tarun Kumar Khulbe highlighted the strategic importance of the deal, stating, “The acquisition of a 100% equity stake in Chromeni will help us climb the value chain. Since we expect the facility to be operational soon, this strategic move will enable the company to capitalize on the robust domestic demand immediately.”
CSPL owns a 0.6 million tonnes per annum (MTPA) cold rolling mill in Mundra, Gujarat. This facility is set to play a key role in meeting the increasing demand for stainless steel in India. Once operational, it will enhance JSL’s production capabilities and provide a competitive edge in the market.
The acquisition of the remaining 46% stake in CSPL costs Rs 278 crore, covering equity transfer and settlement of shareholders’ debt. The total investment of Rs 1,618 crore reflects JSL’s proactive approach to consolidating its assets and bolstering its production infrastructure.
JSL’s acquisition comes at a time when the Indian stainless steel market is experiencing significant growth. Expanding production capabilities aligns with JSL’s broader strategy to serve both domestic and international markets. The acquisition is expected to strengthen JSL’s industry position and contribute to its long-term growth objectives.
Looking forward, the acquisition of CSPL is expected to bring substantial benefits. Integrating CSPL’s facilities into JSL’s operations is anticipated to streamline production processes, reduce costs, and improve efficiency. Enhanced production capacity will enable JSL to meet the growing demand for high-quality stainless steel products in India and abroad.
The market has reacted positively to JSL’s acquisition news, viewing it as a strategic move likely to increase profitability and market share for JSL. Analysts predict that the acquisition will bolster JSL’s financial position and enhance its competitive advantage in the industry.
This strategic acquisition highlights JSL’s commitment to expanding its production capabilities and delivering value to stakeholders. With the operationalization of CSPL’s cold rolling mill in Mundra, JSL is set to play a pivotal role in the Indian stainless steel market, driving innovation and growth in the industry.
