A JSW Steel group entity is planning to raise Rs 26 billion through a three-year zero-coupon bond to fund its Rs 39-billion acquisition of Thyssenkrupp Electrical Steel India from Germany’s Thyssenkrupp Group. The financing for the deal will include Rs 26 billion in debt and Rs 13 billion in equity.

The bond, set to be raised on January 24, carries an implied yield of 9.45 per cent. This fundraising is being carried out by Jsquare Electrical Steel Nashik (JESPL), a subsidiary of JSW JFE Electrical Steel, which was established in September 2024. JSW JFE Electrical Steel is a joint venture between JSW Steel and Japan’s JFE Steel, the latter being Japan’s second-largest steelmaker.

As part of the arrangement, both partners will contribute Rs 13 billion in equity to Jsquare and provide a board-approved letter of comfort to ensure that the company can meet its financial commitments related to the bond issuance, according to the bond’s terms.

Jsquare, currently without its own operations, was set up just four months ago. Following the acquisition, the joint venture plans to rebrand Thyssenkrupp Electrical Steel India to reflect the JSW and JFE brands.

The transaction will grant JSW Steel (JSWSL) an exclusive license from Thyssenkrupp to manufacture cold rolled grain oriented (CRGO) electrical steel in India, a capability limited to a select few steel producers globally. Additionally, Jsquare is expected to benefit from managerial, financial, and operational support from both JV partners, according to Care Ratings, which assigned an AA- Stable rating to the proposed non-convertible debentures (NCDs).

JSW Steel currently has a production capacity of 35.7 million tonnes per annum (MTPA), including 1.5 MTPA in the United States, while JFE Steel is a globally renowned steel manufacturer with a long-standing collaboration with JSW Steel.

There are two ways of looking at the 1.7% decline in China’s steel output last year.The first is that it confirms that the world’s largest producer of the key industrial metal is now in an established downtrend, and further weakness is likely this year.
The second is that the steel industry is actually remarkably resilient in the face of major economic challenges, and that output has been essentially flat at extremely strong levels for the past five years. Both are essentially factual, and reflect the classic glass half-full or half-empty dilemma.
On the half-empty side of the ledger is the fact that China’s steel production peaked at 1.065 billion metric tons in 2020, and has trended lower since then, with 2024 output coming in at 1.005 billion tons. But another way to look at China’s steel output is that it has been within a 70 million ton range between 2019 and 2024, which is actually quite a stable performance.
Perhaps the best way to characterise China’s steel production is that it likely has peaked, but the decline so far has been gentle, and output remains relatively high despite the well-publicised struggles of the world’s second-biggest economy since the COVID-19 pandemic.
Similar to other markets, the answer remains unclear and subject to factors yet to come into play, chief among them what trade tariffs are put in place by the new administration of U.S. President Donald Trump, who resumed the office . It’s also uncertain as to whether 2025 is the year China’s struggling residential property sector gets back on its feet, or whether it remains hostage to weak developer balance sheets and consumer wariness. A third factor is what will happen to China’s steel exports in 2025, after they hit a nine-year high of 110.72 million tons in 2024.
This was up 22.7%, or just over 20 million tons, from the previous year, with the increase helping to offset some loss of domestic consumption for steel mills. The volume of Chinese steel hitting global markets has led to some consternation among countries such as India, which is trying to boost the pace of expansion of its own steel sector.
This raises the possibility that China may find it harder to increase steel exports in 2025.But it is worth noting that not all importing countries are opposed to buying more steel from China, especially those without a domestic steel sector. The best-case scenario for China’s steel sector this year is one where trade tariffs aren’t too punitive, the domestic economy continues to regain momentum and construction activity stabilises, or perhaps even increases. Under such a scenario, the best outcome for China’s steel production would be steady output around 1 billion tons. This also means that China’s demand for iron ore is likely to remain steady as well, although it may ease from the record high of 1.24 billion tons in 2024.

ArcelorMittal Nippon Steel India (AM/NS India) is set to commission a 2 million tonne production capacity for advanced automotive steel products at its Hazira plant by March 2025. This new capacity aims to eliminate the need for steel imports in India’s automotive sector, aligning with the government’s ‘Atmanirbhar Bharat’ initiative.
The company has invested Rs 85 billion into this new product line, which will specifically cater to the automotive industry. AM/NS India is in the final stages of obtaining approval from various automobile manufacturers for the new production.
The expansion includes two new units: a Continuous Galvanizing Line and a Continuous Galvanizing and Annealing Line, which will incorporate advanced technical expertise from both ArcelorMittal and Nippon Steel. These units are expected to be fully operational in 2025 and will produce licensed products with strength levels up to 1180 MPa in both coated and uncoated steel.
This initiative builds on AM/NS India’s earlier success with its introduction of Optigal and Magnelis products. The company aims to meet the growing demand for high-quality automotive steel in India, which currently stands at 7.8 million tonnes annually and is projected to grow by 7% each year.

Ranjan Dhar, Director and Vice-President of Sales and Marketing at AM/NS India, emphasized that the automobile industry currently imports about 15% of its annual 8 million tonne steel consumption. With the new production lines, the company expects to meet this demand domestically, eliminating imports altogether. The product response from the automotive sector has been promising, with AM/NS India already supplying 1.2 million tonnes of auto-grade steel.
AM/NS India aims to capture 30-35% of the auto-grade steel market in India with this expansion.

In addition to its automotive steel venture, AM/NS India plans to increase its crude steel production capacity to 15 million tonnes per annum by 2026, up from the current 9 million tonnes. This expansion will involve an investment of over Rs 600 billion.
The company is also showcasing its automotive innovations, including ArcelorMittal’s Multi Part Integration (MPI) solutions, at the ongoing Bharat Mobility Global Expo. These solutions offer cost efficiencies, reduced manufacturing costs, and streamlined processes through integrated designs, benefiting various automotive applications.
(Business Line)