JSW Cement, led by Parth Jindal and part of the JSW Group, is gearing up for an initial public offering (IPO) to raise up to Rs 4,000 crore, as reported by Money Control. According to industry sources, the company is expected to file draft papers with the Securities and Exchange Board of India (SEBI) soon.
This IPO could be the first significant public offering in the cement sector since the Nirma group-backed Nuvoco Vistas raised Rs 5,000 crore in August 2021.
IPO Details
- Total Amount: The IPO is expected to raise Rs 4,000 crore.
- Components:
- Fresh Issue: Rs 2,000 crore
- Offer for Sale (OFS): Rs 2,000 crore
- Purpose: The OFS will allow partial exits for external investors like Apollo Global Management, Synergy Metals Investment Holding, and SBI.
Market Impact
Following the news of JSW Cement’s IPO plans, shares of Shiva Cement, a subsidiary of JSW Cement, surged by 15%. Shiva Cement supplies clinker, a critical component in cement production, to JSW Cement.
Strategic Goals
JSW Cement aims to use the IPO proceeds to fuel its growth and become one of the top five cement producers in India. The company plans to reach a production capacity of 60 million tonnes per annum (mtpa) within the next five years.
Expansion Plans
JSW Cement is also planning to invest Rs 3,000 crore to set up a new cement manufacturing facility in Nagaur district, Rajasthan. The company is reportedly one of the contenders to acquire a stake in Orient Cement.
Financial Performance
For the financial year ending March 31, 2024, JSW Cement reported:
- Revenues: Rs 5,845 crore
- Profit: Rs 59 crore
Current Capacity and Future Plans
As of March 2024, JSW Cement’s production capacity stood at 20.6 mtpa, distributed across:
- South India: 11.0 mtpa
- East India: 5.1 mtpa
- West India: 4.5 mtpa
The company plans to further expand its geographical reach by entering North India with new units in Rajasthan and Punjab. It also aims to increase capacity at its Vijayanagar unit and Shiva Cement subsidiary, targeting a total capacity of 30.6 mtpa by FY27.
JSW Cement’s Portfolio
JSW Cement offers various grades of cement including:
- PSC (Portland Slag Cement)
- OPC (Ordinary Portland Cement)
- CHD (Concreel HD)
- GGBS (Ground Granulated Blast Furnace Slag)
- CPC (Composite Cement)
The company operates manufacturing units in Karnataka, Andhra Pradesh, West Bengal, Odisha, and Maharashtra. It is also involved in producing green building materials, such as “GreenCrete,” which combines durability with lower carbon emissions.
