Company Overview

Jindal Steel & Power Ltd (JSPL) (NSE: JINDALSTEL) is an industrial powerhouse with a dominant presence in steel, power, mining and infrastructure sectors. Led by Mr Naveen Jindal, the company’s enviable success story has been scripted essentially by its resolve to innovate, set new standards, enhance capabilities, enrich lives and to ensure that it stays true to its cherished value system.1


Business Segments


As one of the largest steel producers in India with a turnover of more than $5.5 billion, JSPL has revolutionised the process of steel making in India.

Jindal Steel and Power Limited (JSPL) is one of the top steel companies in India that has also been ranked as the second largest value creator in the world. Customisation is at the core of all its product development and its global technology excellence ensures the best in class offerings for its valued customers.2

The company’s product portfolio spans across the steel value chain from widest flat products to a whole range of long products and rails. JSPL exports its diversified product portfolio to 22+ countries.

Plant locations:

RaigarhChhattisgarh3.6 MTPA

0.6 MTPA (Wire Rod Mill )

1.0 MTPA (Bar Mill)

AngulOdisha6 MTPA (Integrated steel Plant)
BarbilOdisha9 MTPA (Pellet Plant)

2.40 MTPA (Steel)

1.40 MTPA (Bar Rod Mill)


Jindal Power Limited (JPL), a subsidiary of Jindal Steel & Power Limited, is a leading power company in India across the energy spectrum: thermal, hydro and renewable. With the help of its technical and managerial capabilities, JPL has been able to contribute significantly to the growing needs of power in the country. It has also set new benchmarks in India’s power sector. 3

Plant locations:

TamnarChhattisgarh3400 MW IPP
Etalin Hydroelectric ProjectArunachal Pradesh(Planned)3097 MW Capacity Project
Kamala Hydroelectric ProjectArunachal Pradesh(Planned)1800 MW Capacity Project
Attunli Hydroelectric ProjectArunachal Pradesh(Planned)680 MW Capacity Project
Powr-AnonpaniArunachal Pradesh(Planned)22 MW Hydropower Project
MozambiqueAfrica1x150 MW
SenegalAfrica350 MW


JSPL has a mining capacity of over 9.11 MTPA of coal and iron ore at various locations in India and abroad. Owning captive mines has ensured its company of uninterrupted supply of high-quality raw materials. This has reduced the dependency on the third party, thereby resulting in cost and time-saving. 4

Plant locations:


Construction Solutions

JSPL has forayed into the Construction Solutions Business to harness the potential for the need of lighter, faster, easier, affordable and environment friendly methods of construction. The company's product profile encompasses a wide variety of structural steel products ranging from basic E250 and E350 grade fabricated structures to special engineered products like High Tensile Strength E550 and E450 MPA fabricated steel structures and Hot Rolled Sections for various structural steel requirements for bigger & clear span structures which ensure optimum steel consumption and reduce project gestation period and overall cost. JSPL is the first and the only steel producer in India producing as well as fabricating E 550 grade Steel plates. In addition to this, its company has introduced several smart and innovative construction solutions – like Speedfloor, Cut & Bend, Weld-mesh etc. – to tackle the need for faster construction. 5


Global Ventures

Oman Operations

JSIS was acquired in 2010 as a 1.5 MTPA Direct Reduced Iron (DRI) capacity at Sohar Industrial Port Area in Oman. The Company successfully commissioned a 2 MTPA Integrated Steel Plant (ISP) in July 2014 by adding a 2 MTPA Steel Melting Shop (SMS) facility, using technology from M/s Danielle Italy. The SMS was commissioned in 23 months from the date of commencement of the site work.

The capacities were progressively expanded to the current capacity of 1.8 MTPA Direct Reduced Iron (DRI), 2.4 MTPA Steel Melting Shop (SMS) and 1.4 MTPA Rebar Mill.

Mozambique Operations

JSPL Mozambique Minerals Limitada (JMML), an indirect subsidiary of JSPL, owns and operates an open-cast coking and thermal coal mine located in Chirodzi, Mozambique. The Govt. of Mozambique allotted 25 years of a Mining concession in December-2010 to Jindal Mozambique. The open-cast coal mine has a proven reserve of nearly 700 MT and mining operations has been ramped up to 5MTPA effectively. The coal mine is in Mozambique’s coal-rich Moatize region. JMML has its own rolling stock to export the coal through Beira Port using Sena Railway Line. The mining area is under a lease period valid until 2035.

Australia Operations

Wollongong Coal Limited (“WCL”) is an Australian mining company, which owns and operates Russel Vale Colliery (RVC) and Wongawilli Colliery (WWC) in the Southern Coalfields Region of New South Wales, Australia. In October 2013, JSPML acquired a majority stake and management control in Wollongong Coal Limited (formerly Gujarat NRE Coking Coal Ltd or GNCCL), a company registered in Australia and incorporated in October 2004 by Gujarat NRE Coke Limited (GNCL). The shareholding in the Company has increased since then by way of a rights issue. Currently, JSPL holds 60.38% stake in WCL through its subsidiary, JSPML. Both mines are near the Port Kembla Coal Terminal (PKCT) with RVC connected via road and WWC connected via rail. PKCT is privately owned and operated by six stakeholders, including WCL.

South Africa Operations

Jindal Mining SA (Pty.) Limited, is a 73.94% owned indirect subsidiary of JSPML, which in turn is a 100% subsidiary of JSPL. Kiepersol Colliery is situated 35km southwest of the town of Piet Retief, Mpumalanga, South Africa with captive Railway Siding around 35 km from the mine and a distance of 337 km Railway Siding to Port distance. The colliery was acquired in July 2009 with a proven reserve of 22MT. Currently, three sections in two seams are operating. Two of these sections are operated in-house while the contractor operates one section; all with Mechanised underground mining through Bord & Pillar extraction method.


Products Portfolio

Jindal Steel and Power Limited (JSPL) is one of the top steel companies in India that has also been ranked as the second largest value creator in the world. Customisation is at the core of all its product development and its global technology excellence ensures the best in class offerings for its valued customers. 6

JSPL produces economical and efficient steel and power through backward and forward integration. The company’s product portfolio spans across the steel value chain from widest flat products to a whole range of long products and rails. JSPL exports its diversified product portfolio to 22+ countries.

  • Rails
  • Parallel Flange Beams & Columns
  • Plates & Coils
  • Angles & Channels
  • Wire Rods
  • Round Bars
  • Speedfloor
  • Jindal Panther TMT Rebars
  • Jindal Panther Cement
  • Fabricated Sections
  • Semi-Finished Products


Industry Overview

Global Steel Industry

According to the World Steel Association (WSA), global crude steel production grew by 3.0% YoY at 1,868.8 million tonnes per annum (MTPA) in 2019. China, India, Japan, and the USA continued to be the top four countries in crude steel production in 2019, producing more than 69% of the world’s total steel output. Russia frog-leaped South Korea and was placed 5th in crude steel production in 2019. The Middle East’s crude steel production surged by 19.2% YoY to 45.3 MTPA in 2019. 7

Indian Steel Industry

India became the 2nd largest producer of crude steel in 2018 and 2019 owing to a rapid rise in production. As per Joint Plant Committee (JPC), India’s production of total finished steel stood at 102.1 MT in 2019-20.

The Indian steel industry accounts for about 2% to the country’s GDP with an output multiplier of 1.4x and an employment multiplier of 6.8x on the overall economy

During FY2020, India imported 6.8 MT of finished steel, down 13.6% YoY, with non-alloy HRC accounting for 34% of the total imports. Imports from Korea accounted for 40% of the total imports.

India remained a net exporter of finished steel during FY2020, with exports of 8.4 MT, up 31.4% YoY. Non-alloy HRC was the most exported product at 4.8 MT, while bars and rods led the non-alloy, non-flat segment exports with 0.5 MT.

According to WSA, the global per capita finished steel consumption in 2018 was pegged at 224.5 kg and 590.1 kg for China. As per JPC, India’s per capita finished steel consumption in 2018 stood at 73.3 kg and is estimated to reach 74.6 kg in FY2020.

Power Sector

According to the Central Electricity Authority, the total installed power generation capacity of the country stood at 3,70,499 MW in May 2020. This included 2,30,636 MW of thermal power generation capacity, 45,699 MW of hydropower generation, and 87,384 MW of renewable energy generation capacity. Renewable energy comprises of wind, solar and biomass-based electricity. India is the world’s third-largest producer as well as consumer of electricity. For the third successive year, the renewable energy sources added new capacity than the conventional energy sector. As of May 2020, the clean energy sector’s share stands at 23.6%of the total installed energy capacity.India sprints up to 22nd rank in 2019 from 137th rank in 2014 on World Bank’s Ease of Doing Business – ‘Getting Electricity’ ranking. The electricity demand is backed by economic growth and the push to deliver uninterrupted power to all.

India had deployed a total of 87GW of grid-connected renewable electricity capacity in May 2020. The Government aims to increase renewable capacity to 175GW by 2022 and further to 275GW by 2027. According to the International International Energy Agency, India’s energy demand is poised to double by 2040, with electricity demand projected to be tripling due to a continual rise in appliance ownership and cooling needs.

Mining Sector

India is home to 95 minerals – 4 fuel-related minerals, 10 metallic minerals, 23 non-metallic minerals, 3 atomic minerals and 55 minor minerals (including building and other minerals) with 1,531 operating mines. Mining is one of the core sectors and growth driver of the Indian economy valued at 2.8 lakh crores. Mining is the second biggest generator of employment followed by the construction industry. The industry provides basic raw materials to key industries like power generation (thermal), iron and steel, cement, petroleum and natural gas, petrochemicals, fertilizers, precious & semi-precious metals/ stones, electrical and electronics equipment, glass, ceramics, etc.

Iron Ore Mining

India accounts for 8% of the world’s iron ore deposit. With a production of 111.2 MT, India became the second-largest crude steel producer in 2019. As per GlobalData, Mining Intelligence Centre, India’s iron ore output is expected to contract by 12.5% YoY to 205.7 MT in 2020 due to delay in mine auctions in Orissa coupled with lack of clarity on the maximum lease area. According to the Ministry of Steel, India is likely to witness a disruption of 45-50 MT iron ore supply in 2020-21 owing to the expiry of 37 working merchant mines (250+ mines in total) as on FY2020. India has exported 23 MT of iron and pellets from December 2019 to May 2020. The secondary steel manufacturers have urged for Government’s intervention to resolve raw material shortages arising due rise iron ore pellets to China. Iron ore attracts 30% export duty as against zero duty on iron pellets. Exporters are converting iron ore fines to pellets and are shipping to China. The Ministry of Steel has proposed to the Ministry of Mines to trim the royalty of iron ore fines from the existing 15% to 5% to incentivize beneficiation and pelletization as well as minimize the stockpile of low-grade fines dumped at mine heads. According to GlobalData, Mining Intelligence Centre, the iron ore production in India is expected to touch 271.2 MT in 2024 growing at 7.2% CAGR for the forecast period 2020-24 backed by resumption of operations at the auctioned mines.

Cement And Construction

According to the Cement Manufacturing Association, the India cement industry is only next to China with 545 MT production capacity. The cement industry continues to attract huge investments, both from Indian as well as foreign investors after the deregulation in the year 1982. The cement and gypsum products attracted FDI worth US$ 5.28 billion between April 2000 and March 2020, as per data released by the Department of Industrial Policy and Promotion (DIPP).In Budget 2020-21, the Indian Government has extended benefits Section 80 - IBA of the Income Tax Act till March 31, 2020, for promoting affordable housing in India. The Budget 2020-21 has allocated US$ 1.93 billion under Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Smart Cities Mission. The cement demand is expected to be buoyant with the Government’s infrastructure push coupled with ‘Housing for All’, ‘Smart Cities Mission’ and ‘Swachh Bharat Abhiyan’. Additionally, the Government’s plan to upgrade 1,25,000 km of road length over the next five years will provide a fillip to the cement demand. The COVID-19 pandemic has dented the bright prospects of the cement industry by curbing the utilisation curve with weak volumes. The cement recovery is expected to be visible from the second half of 2020, driven by infrastructure demand followed by rural and low-cost housing. The cement industry is projected to achieve 550-600 MT in 2025 owing to the rising demand from housing, commercial construction and industrial construction.


Financial Highlights

Fourth Quarter FY 2020-21 Highlights

  • JSPL reports highest ever consolidated EBITDA of INR 5,287 Cr in 4QFY21
  • Driven by record standalone EBITDA of INR 4,884 Cr in 4QFY21
  • Highest ever consolidated EBITDA of INR 14,444 Cr and PAT of INR 5,527 Cr in FY21
  • Standalone Net debt reduced further by INR 3,067 Cr in 4QFY21 and INR 4,643 Cr in FY21
  • Consolidated Net debt reduced further by INR 3,475 Cr in 4QFY21 and INR 13,773 Cr in FY21
  • Focus shifts entirely to India Steel post Oman stake sale closure and proposed JPL divestment
  • Embarking on next phase of growth in Angul with expansion from 6 MTPA to 12 MTPA at competitive capex of INR18k Cr

Solid operational performance, divestment of non-core assets and lower capex have all contributed in JSPL continuing on the path of deleveraging with net debt declining sharply from INR 35,919 Cr in FY20 to INR 22,146 Cr in FY21. As a result, JSPL’s balance sheet is now the strongest in the sector. The Company in its endeavor to become Net Debt free has made substantial prepayment of INR 2,462 Cr in early May. Net debt has declined to INR 10,589 Cr on Standalone basis and INR 19,332 Cr on Consolidated basis (as on 11th May’21). Strengthening balance sheet coupled with strong upcycle witnessed in steel prices have led to JSPL’s credit rating enhancement to A from BBB- within a span of 4 months. 8

Volume Expansion

JSPL is all set to double its steelmaking capacity at Angul, Odisha to c12 MTPA (from 6 MTPA currently), raising its India crude steel capacity by 66% to c.15.9 MTPA. Key projects driving volume expansion at Angul include 4.25 MTPA Blast Furnace (BF), 2.7 MTPA Direct Reduced Iron (DRI) and 6.3 MTPA Steel Melt Shop (SMS) broadly replicating the present facilities at Angul. It will take it 30 months to commission the 4.25 MTPA BF-BoF, with commissioning expected starting December 2023. This will be followed by 2.7 MTPA DRI plant, with commissioning expected in February 2025. These projects along with the related raw material capacities (2 MTPA coke oven, oxygen plant etc.) will account for almost two-thirds of the planned INR18,000 Cr capex.

Margin Expansion

In its endeavor to become one of the highest margin steel producers globally, JSPL intends to further reduce costs and improve its product mix at Angul. JSPL plans to construct a slurry pipeline between Barbil-Angul (200kms) in conjunction with 12 MTPA pellet plant in Angul (2 phases of 6 MTPA each), which would reduce iron ore logistic costs and bring in additional cash flows from pellet sales. The first phase of the pellet plant is expected to get commissioned in September 2022 and Phase-2 will be commissioned a year later (Sep-23). In order to improve its product mix, JSPL is also planning to construct a 5.5 MTPA Hot Strip Mill (HSM), which will significantly increase Company’s flat steel making capacity from 2.2 MTPA currently to 7.7 MTPA. These margin expansion projects of both backward and forward integration account for the remaining one third capex and have a strong IRR delivering a short payback period.

JSPL Consolidated Performance

Fourth Quarter FY21 Performance

Improved performance across steel, power and overseas mining operations in 4QFY21, have resulted in JSPL reporting the highest ever Consolidated Gross Revenue of INR 13,190 Cr . Strong operational performance coupled with better pricing environment have led to Consolidated EBITDA hitting a new record of INR 5,287 Cr. Higher EBITDA and declining interest costs have led to net profit of INR 1,901 Cr .

Full Year FY21 Performance

Strong FY21 performance for the India steel and power business, helped JSPL report a record Consolidated Gross Revenue of INR 42,745 Cr and EBITDA of INR 14,444 Cr. Consolidated PAT (Continuing Operations) not only turned positive after posting a loss for the past 6 years, but also hit an all-time high of INR 5,527 Cr.

Company’s unflinching focus on strengthening the balance sheet has resulted in consolidated net debt declining further by INR 3,475 Cr in 4QFY21 (INR 13,773 Cr in FY21). As on March 2021, JSPL reported Consolidated Net Debt of INR 22,146 Cr. Net Debt to EBITDA (Trailing) at the end of March’21 stood at 1.53 x (vs 2.35 x as on December ’2020).


Structural changes in China to curb steel exports (removal of export rebate), strong focus on reducing carbon emissions and ongoing geopolitical tensions are likely to provide continued support to current steel upcycle, in its view. India however is currently facing threat from the ongoing second wave of Covid-19, which has turned out to be much severe compared to earlier wave. JSPL remains committed to prioritising human lives in these challenging times and has been diverting oxygen supply to various states (daily run rate has been increased to 120 tonnes recently from 100 tonnes). JSPL is providing Liquid Medical Oxygen to the states of Telangana, Maharashtra, Andhra Pradesh, Gujarat, Odisha, Chhattisgarh, Madhya Pradesh, Delhi and Haryana. While slowdown in construction activities within the country and diversion of oxygen supply has resulted in lower production and sales recently, strong export markets due to change in Chinese policies and ongoing vaccination drive involving country’s broader population bode well for steel demand and pricing outlook in FY22 and beyond.

Outlook for Indian steel producers has turned extremely bright in the past year and JSPL’s decision to divest power assets (JPL) is in line with its renewed strategy to focus on the company’s promising India Steel operations.


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Created by Asif Farooqui on 2021/06/07 18:40

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