Home >Companies >News >JSW Steel will turn around, integrate Monnet Ispat within a year, says chairman Sajjan Jindal

Mumbai: Sajjan Jindal believes his company JSW Steel will turn around and merge the bankrupt Monnet Ispat with itself within a year.

“We will eventually merge Monnet Ispat into JSW Steel and it will be a JSW brand. Our past experience is normally we turn-around in one year, so we hope that will happen," Jindal, chairman and managing director of JSW Steel, said on the sidelines of the company’s annual shareholder meeting on Tuesday.

Last week, the National Company Law Tribunal (NCLT) approved AION-JSW Steel consortium’s 2,875 crore takeover proposal for the 1.5 million tonne asset in Chhattisgarh run by Monnet Ispat and Energy.

Located close to the mineral-rich belts of Chhattisgarh and Odisha, this acquisition will be crucial in extending JSW’s reach in the central and eastern markets.

JSW has also tossed its hat in the ring for the 10 million tonne steel capacity of Essar Steel.

Jindal declined to comment on the plan because the eligibility of some bidders is being evaluated by the courts. He also declined to comment on the company’s interest in buying out the specialty steel business of Usha Martin. JSW and Vedanta are believed to be interested in buying out the stressed units of the Kolkata-based Usha Martin.

In his speech to shareholders, Jindal said that JSW delivered a record performance in FY 2017-18. “During the year, we have achieved the highest-ever production, shipments, revenues, and EBITDA. As a result, the net profit after tax grew by 76% YoY to 6,113 crore. With a 16% return on capital employed, JSW Steel is amongst the top 5 steel companies globally."

In his outlook for FY19 he said, “with a 93% capacity utilisation targeted for the current year, there is a limited headroom to deliver volume growth till we complete our expansion projects by March 2020. Nevertheless, there are a number of other strategic levers which will help us to continue to improve our profitability over the next two years." These include operationalising the remaining 3 of the 5 captive iron ore mines the company has in Karnataka. With this, JSW expects to meet approximately 20% of the total iron ore requirement at Vijayanagar. The company is also working on starting mining at the Moitra coking coal mine in Jharkhand by next year.

JSW is investing 45,000 crore over a four-year period from FY2017-18 to FY2020-21 to expand its steel making capacities and to modernise and expand capacities of its downstream businesses. On completion, the company’s overall capacity will rise from currently 18 million tonnes per annum (mtpa) to 24.7 mtpa by March 2020.

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