·
Jindal said steel
consumption will grow at a healthy rate and recent government measures such as
the export duty on steel exports are only a short-term headwind for the
industry.
MUMBAI : Although global growth
expectations have moderated recently, the structural demand drivers for
commodities like steel remain intact, said Sajjan Jindal, chairman and managing
director of JSW Steel Ltd in a message to shareholders in the company’s annual report.
“The financial year gone by was a mixed
bag, with most major economies rebounding from the negative effects of
COVID-19. However, commodity price volatility, soaring energy prices, lingering
supply chain challenges and geopolitical conflicts have made the recovery
increasingly fragile," siad Jindal in his message.
JSW Steel delivered its highest-ever
Ebitdavof ₹39,007 crore and profit of ₹20,938
crore in FY22. Its net debt-to-Ebitda, on a consolidated basis, stands at a
comfortable 1.45 times. Ebitda is earnings before interest, tax, depreciation
and amortisation.
Jindal added that steel consumption will
grow at a healthy rate and recent government measures such as the export duty
on steel are only a short-term headwind for the industry.
“The future of the Indian steel industry
is exciting with a steadily expanding domestic market. During FY 2021-22,
Indian steel consumption grew to 106 MnT from the prepandemic level of 100 MnT.
Demand is expected to grow at a healthy rate through the current decade. We
view the export duties imposed on steel in May 2022 as a shortterm headwind,
since they have been imposed with the objective of controlling inflation. We
continue to engage with the government on this matter and believe that the
duties would be withdrawn once inflation moderates," said Jindal.
India is a cost-competitive exporter of
steel, and has an opportunity to take on a larger role in the global steel
trade, added Jindal. “We are expanding our India capacity in a phased manner to
37 MTPA from 27 MTPA at present to tap the opportunities in the domestic as
well as global markets," he said.
JSW Steel is expanding its Vijayanagar
plant from 12 MTPA to 19.5 MTPA, while Bhushan Power and Steel is being
expanded to 5 MTPA. It recently finished a 5 MTPA expansion of its Dolvi
facility.
Jindal also highlighted the company’s
efforts to reduce carbon emissions and other efforts on the ESG front. Last
fiscal, JSW Steel raised $500 million through Sustainability linked bonds (SLB),
the first such issuance by an Indian steel maker.