JSW Group and South Korea’s POSCO have signed a strategic agreement to collaborate in steelmaking, electric vehicle (EV) batteries, and renewable energy projects, marking POSCO’s fourth attempt to establish a foothold in India over the past 15 years. As part of the agreement, the two companies will initially set up a 5 million tonnes per annum (MTPA) integrated steel plant, with provisions for future capacity expansion. While the partnership details remain undisclosed, industry sources expect the plant to be located in Jagatsinghpur, Odisha, where JSW Utkal Steel has already secured regulatory approval for a 13.2 MTPA steel unit—projected to be India’s largest single-location steel plant.
POSCO’s earlier attempts to enter the Indian market faced multiple setbacks. In 2010, it announced a joint venture with the Steel Authority of India (SAIL) for a steel unit in Bokaro, Jharkhand, but the partnership dissolved over shareholding disagreements. Similar plans to establish steel plants in Karnataka and Odisha were scrapped in 2013 and 2017, respectively, due to land acquisition issues, protests, and delays in regulatory approvals. Ironically, the Jagatsinghpur site now allocated to JSW was the same land POSCO abandoned in 2017.
Speaking on the collaboration, Sajjan Jindal, Chairman of JSW Group, emphasized that the partnership aligns with India’s rapid economic growth and JSW’s focus on sustainable development. "Our collaboration with POSCO strengthens our commitment to drive transformation across key sectors," Jindal stated. POSCO’s chairman, Chang In-hwa, added, "This partnership will not only contribute to the economic growth of both countries but also promote a more sustainable and eco-friendly future."
The partnership also aims to foster renewable energy projects and support the development of an EV ecosystem in India. Through its listed subsidiary JSW Energy, the group already has a significant presence in renewable energy, while its investment in MG Motor India, the domestic arm of China’s SAIC Motor, reflects its ambitions in the EV sector. JSW Steel also operates a joint venture with Japan’s JFE Steel for manufacturing grain-oriented electrical steel in India.
JSW Group, a $24 billion conglomerate, operates across multiple industries, including steel, energy, infrastructure, cement, and mobility. JSW Steel’s stock closed at Rs 959.35 on the NSE, down about 1%.
In related news, JSW Steel anticipates improved margins in the second half of FY25, following a recovery in steel prices from multi-year lows in September. Jayant Acharya, joint managing director at JSW Steel, expressed optimism, citing cost-cutting measures and new capacity expansions that will help boost sales and spread fixed costs. Acharya also noted that coking coal costs are expected to decline by $20-25 per tonne, further supporting the company’s margin recovery. "We are optimistic about H2," he said, predicting stronger demand and higher EBITDA driven by increased production capacity.
(Mint)
