JSW Steel plans ₹2 trillion investment to scale up capacity by 25 mt

JSW Steel is preparing for one of its largest expansion cycles yet, with plans to invest more than ₹2 lakh crore over the next five years to add nearly 25 million tonnes of new steelmaking capacity. The strategy reflects the company’s confidence in India’s long-term demand growth and the depth of opportunity in the domestic market.

The Sajjan Jindal-led steelmaker intends to fund the programme largely through internal cash generation, complemented by a calibrated level of borrowing. Capital will be channelled not only into new steel capacity, but also into downstream value-added facilities, mine development, digital systems and wider adoption of artificial intelligence across operations.

As part of this push, JSW Steel’s board has cleared a 5 mt greenfield project at Paradip in Odisha. This approval has taken the company’s ongoing capital expenditure commitments beyond ₹1 lakh crore. Once current projects are completed, JSW Steel’s installed capacity in India is expected to reach 47.4 mt by the end of the decade.

Management indicated that further proposals are in the pipeline and could be placed before the board over the next one to two years. These include a potential 5 mt expansion at the company’s flagship Vijayanagar plant in Karnataka and a 2 mt low-carbon steel facility at Salav in Maharashtra. If executed, these additions would lift JSW Steel’s capacity to more than 56 mt by FY31.

Beyond this, the company retains several optional growth levers. Paradip could be expanded by another 5 mt, Salav’s capacity could be doubled to 4 mt, and Bhushan Power & Steel could be scaled up to 10 mt from the current 4.5 mt, in partnership with Japan’s JFE Steel.

While global steel prices touched multi-year lows in the recent quarter, prices recovered from mid-December through January. For the first nine months of the year, JSW Steel reported EBITDA of ₹22,335 crore, close to its full-year FY25 performance. Annualised EBITDA of around ₹30,000 crore is expected to strengthen further as an additional 7 mt of capacity comes on stream by FY28.

The balance sheet is also set to improve materially. The company expects to reduce net debt by about ₹37,000 crore by June following JFE Steel’s acquisition of a 50 per cent stake in Bhushan Power & Steel. Management said this deleveraging will allow JSW Steel to pursue expansion while maintaining financial discipline.

According to the company, most of the incremental output will be absorbed domestically. Steel consumption in India is projected to rise by 11 mt in FY26 and 13 mt in FY27, driven largely by public sector spending. JSW Steel is also watching for further momentum in private capital expenditure, supported by structural reforms and recent tax measures.

Sustained growth in domestic demand could help offset headwinds in export markets, particularly Europe, where the carbon border adjustment mechanism has begun to impact trade. JSW Steel plans to increasingly redirect volumes towards the Indian market and other non-European destinations as it executes its next phase of expansion.