Jindal Stainless Limited (JSL) has announced the acquisition of the remaining 46% equity stake in Chromeni Steels, making it a wholly-owned subsidiary of JSL. The acquisition, approved by JSL’s board, is valued at ₹277.90 crore, which includes ₹188.19 crore for equity purchase and ₹89.71 crore towards Chromeni Steels Private Limited’s (CSPL) debt.
In a regulatory filing, JSL stated, “We wish to inform you that the Board of Directors of the Company at its meeting held today, i.e., June 14, 2024, considered and approved the acquisition of the remaining 46% equity stake in CSPL, thereby making CSPL a wholly-owned subsidiary of the Company with effect from June 14, 2024.”
Chromeni Steels operates a cold rolling mill in Mundra, Gujarat, with an annual capacity of approximately 0.6 million tonnes. This latest acquisition follows JSL’s earlier purchase of a 54% stake in Chromeni Steels through the acquisition of Evergreat International Investment Pte Ltd, Singapore. The initial 54% acquisition was part of JSL’s strategy to boost its cold-rolled capacity and enhance its presence in the value-added segment over the long term.
With the complete acquisition, JSL aims to achieve better control, uniformity in policies, and greater synergies between the two companies. This move is expected to streamline operations and bolster JSL’s market position in the stainless steel sector.
Earlier in May, Jindal Stainless announced a capital expenditure (capex) plan of ₹4,700 crore for FY25, up from ₹3,800 crore in FY24. The increased capex is aimed at supporting the company’s expansion plans, driven by the expectation of rising domestic demand. Managing Director Abhyuday Jindal highlighted the importance of this investment for the company’s future growth and market positioning.
Despite the strategic moves, JSL reported a 30% decline in consolidated net profit for the fourth quarter, amounting to ₹501 crore. The company’s net revenue decreased by 3% to ₹9,454 crore, while EBITDA fell by 10% to ₹1,035 crore. The decline in margins was attributed to negative inventory valuation caused by falling nickel prices.
The complete acquisition of Chromeni Steels marks a significant step in JSL‘s growth strategy, reinforcing its commitment to expanding its production capabilities and enhancing its market presence in the stainless steel industry.
