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Man With A Steely Resolve

Known to be a ‘man of steel’, Sajjan Jindal is always getting prepared to meet the future demands and challenges. That is why JSW Steel is his group’s flagship company

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Sajjan Jindal, Chairman & MD, JSW Steel

Sixty-year old Sajjan Jindal is widely known as one of the successful business icons of India. As Chairman and Managing Director of JSW Steel, the flagship company of the the diversified JSW Group, Jindal has over the years helped steer JSW Steel to the top position with his astute guidance, grit and the ability to see opportunity in every challenge that comes his way. So much so that JSW Steel is today’s India’s second-largest private steel producer.

The company has formed a strategic tie-up with the world’s sixth-largest and Japan’s second-largest steel producer JFE Steel. JSW Steel is also pursuing an ambitious expansion plan.

Hailing from an illustrious business family, Sajjan and his brothers Prithviraj, Ratan and Naveen each run their own businesses that were primarily inherited from their father.

JSW Steel, the flagship company of the over $13-billion JSW Group, is also one of India’s leading integrated steel manufacturers with a capacity of 18 MTPA. It is one of the fastest growing companies in India with a footprint across 140 countries. Just about eight-nine years ago, JSW Steel, among others, were witnessing shrinking steel production due to a raging controversy over illegal mining in Karnataka and the resultant ban on iron ore mining in Karnataka ordered by the country’s top court. Or take the example of the four-year downturn in the steel industry from 2012 to 2016. Despite the challenges, Jindal currently owns over a dozen steel plants including three outside the country. Today, JSW Steel’s plant in Vijayanagar is the largest in the country with a capacity of 12 million tonnes per annum. By next year, its capacity is expected to grow to 18 MTPA.

For the full year, it posted a net profit of Rs 7,524 crore, up 23 per cent from Rs 6,113 crore in FY18. Revenue from operations for the same period also witnessed a 16 per cent growth to Rs 84,757 crore. However, net debt has also increased. For FY19, the company’s net debt stood at Rs 45,969 crore, up from Rs 38,000 crore at the end of FY18. JSW Steel, which is currently implementing a massive capital expenditure programme, has decided to raise its capex programme by Rs 5,700 crore to Rs 48,715 crore. Out of this, Rs 1,000 crore will go into downstream investment, Rs 2,200 crore into cost-saving projects and Rs 2,000 crore into mining and sustenance capex. Of this total, the company will spend Rs 34,300 crore over FY20 and FY21.

For FY20, the company’s crude steel production guidance stood at 16.95mt and saleable steel sales at 16mt, an increase of 1.5 per cent on the actual numbers for FY19. This would translate into 95 per cent capacity utilisation for JSW Steel. While the World Steel Association’s guidance for 2019 was 1.3 per cent growth in global demand, Rao said demand in India will grow by 6.5-7 per cent. At the board meeting, the company’s management passed a resolution to raise up to Rs 14,000 crore through either debt or equity instruments through a qualified institutional placement process.

In recent years, Jindal has been able to successfully execute the acquisition of Bhushan Power & Steel by outbidding rival Tata Steel which had earlier snatched Bhushan Steel. Jindal is always preparing for the future demands. Experts say he sees a massive demand for steel in the coming years and decades and is, therefore, aligning a calculated road map for capacity expansion. According to the National Steel Policy document of 2017, steel demand will touch 300 million tonnes a year by 2030-31. The current capacity is less than half of projected numbers.

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