20 - 05 - 2026

JSW Steel sets up to ₹24,000 crore capex for FY27 to drive capacity expansion

JSW Steel has earmarked a capital expenditure (capex) of ₹22,000-24,000 crore for FY27, to be spent across various steel capacity expansion projects. The steelmaker has guided towards a total capex of ₹1,26,000 crore over the next 4-5 years, CreditSights said in a report.

The investment aims to lift its combined steel production capacity to 78 mtpa – comprising 62 mtpa for standalone operations and 16 mtpa for joint ventures (JVs) – by FY32. This is more than double of the current 36.4 million tonne per annum (mtpa).

The long-term strategy marks a further boost to the steel capacity target from the previous 50 mtpa by the financial year 2030 (FY30) target, it said.

CreditSights expects actual FY27 spending to undershoot guidance at ₹19,000 crore to ₹20,000 crore.

The spending breakdown allocates 65 per cent to steel capacity growth, 11 per cent to value-added product facilities, 12 per cent to mining and cost-saving projects, and 12 per cent to sustenance capex. Downstream projects include a 0.55 mtpa cold rolled non-oriented (CRNO) electrical steel plant at Vijayanagar by March 2028 and a 1 mtpa structural mill at Raigarh by FY29. Key JV projects involve a 6 mtpa greenfield plant in Odisha with POSCO by 2031 and expanding BPSL to 10 mtpa with JFE by 2030. JSW Steel also intends to hit a 50 per cent captive mix for coking coal and iron ore by FY31.

The company’s total revenue and earnings before interest, taxes, depreciation, and amortisation (EBITDA) for FY26 grew by 10 per cent and 30 per cent on a year-on-year (YoY) basis, respectively. Revenue reached ₹1,85,500 crore from ₹1,68,800 crore in the previous year.

Gross and net leverage improved to 3.3 times and 2 times, largely driven by proceeds from the 50 per cent stake sale of Bhushan Power & Steel Limited (BPSL). Volume growth rose 12 per cent YoY, driven by domestic segments including automotive (up 19 per cent), retail (up 13 per cent), and construction and infrastructure (up 4 per cent).

Management lowered its maximum internal caps for net debt/equity from 1.75 times to 1.25 times and for net leverage to 3 times from 3.75 times.

Net leverage is projected to decrease to 1.5–1.6 times in FY27, aided by an anticipated ₹7,900 crore deleveraging from JFE Steel’s second tranche of payment for BPSL by the end of the first quarter of FY27.