Management

• Parth Jindal (Managing Director)
• Seshagiri Rao Venkata Satya Metlapalli (Chairman and Non-Executive Director)
• Nilesh Narwekar (Whole Time Director and Chief Executive Officer)
• Kantilal Narandas Patel (Non-Executive Non-Independent Director)
• Utsav Baijal (Non-Executive Nominee Director)
• Sudhir Maheshwari (Non-Executive Nominee Director)
• Pankaj Rajabhau Kulkarni (Independent Director)
• Sutapa Banerjee (Independent Director)
• Sumit Banerjee (Independent Director)
• Akshay Chudasama (Independent Director)
• Aashish Kamat (Independent Director)
• Raghav Chandra (Independent Director)
• Preeti Reddy (Independent Director)
• Narinder Singh Kahlon (Director - Finance and Commercial and Chief Financial Officer)

Use of Proceeds

The total issue size is Rs.3,600cr, which comprises of fresh issue of Rs.1,600cr and offer for sale (OFS) component of Rs.2,000cr. The company intends to utilize Net Proceeds towards prepayment or repayment, in full or part, of all or a portion of certain borrowings availed by the company (520cr). Part financing the cost of establishing a new integrated cement unit at Nagaur, Rajasthan (800cr) and general corporate purposes.

Competitive Strengths

Robust Group Backing and Experienced Leadership JSW Cement benefits from the strong corporate lineage of the JSW Group, a diversified conglomerate with businesses across steel, energy, infrastructure, maritime, realty, paints, and more. In Fiscal 2025, five JSW Group entities recorded consolidated revenue of Rs.1,950.64 billion, with a market capitalisation exceeding Rs.4,211.71 billion. The company leverages group synergies, including access to blast furnace slag from JSW Steel, power via long-term PPAs with JSW Energy, insights on coal sourcing, and competitive sea freight due to the group’s scale. Digital tools like the JSW Aikyam app support data-driven sales opportunities. Backed by promoters Mr. Sajjan Jindal and Mr. Parth Jindal, JSW Cement also benefits from a strong governance framework and an experienced board and leadership team. In 2021, global investors, including Apollo and Synergy Metals, along with SBI, infused capital, reinforcing strategic confidence in the business.

Widespread Distribution Network and Strong Brand Positioning JSW Cement has built an extensive pan-India sales and distribution network comprising dealers, sub-dealers, and warehouses to serve retail (trade) demand, alongside direct institutional customers (non-trade). As of March 31, 2025, its in-house sales team of 269 officers manages dealer relationships and warehouse inventory. An influencer loyalty programme launched in FY2022 targets masons, contractors, and architects who influence purchase decisions, rewarding them with redeemable loyalty points. Strategic plant locations reduce delivery times and logistics costs, enhancing customer service. All products are marketed under the “JSW” brand, backed by a brand equity agreement, and promoted through regional advertising, billboards, digital media, and sports sponsorships. JSW Cement also supports non-trade clients with NABL-accredited concrete testing labs. Its cement has been used in landmark infrastructure projects like Mumbai Metro 7A, Paradip Port, Bangalore–Mangalore Highway, and the Hadua Dam in Odisha.

Strategically Located Plants with Efficient Connectivity JSW Cement’s manufacturing footprint spans the southern, western, and eastern regions of India, with plants strategically located to ensure seamless access to raw materials and key consumption markets. Its integrated and clinker units are situated close to limestone mines, the Nandyal plant is just 1 km from the JSW Nandyal limestone mine. This ensures efficient sourcing of clinker inputs. Grinding units are either co-located with JSW Steel’s facilities or well-connected by rail and road to regional steel plants, enabling cost-effective transport of blast furnace slag. Plants are also closely aligned to consumption hubs, such as Dolvi and Jajpur, which are only 100 km and 123 km away from the Mumbai Metropolitan Region and coastal Odisha, respectively. Several units have in-plant or nearby railway sidings, such as Vijayanagar, Salboni, and Shiva Cement, further enhancing the company’s logistical efficiency and market responsiveness.

Industry-Leading Sustainability and Circular Economy Practices JSW Cement has the lowest carbon dioxide emission intensity among peer cement manufacturers in India and top global players, driven by a business model rooted in circular economy principles. The company maximises the use of industrial by-products like blast furnace slag, Al-killed slag, fly ash, red mud, and chemical gypsum, making it the highest in waste-based raw material usage among peers in FY2023–FY2025. Its clinker-to-cement ratio stood at 50.13% in FY2025, significantly below the industry average of 66.43%. Green cementitious products, GGBS and blended cements formed 77.41% of total volumes in FY2025. JSW Cement also substitutes conventional fuels with industrial and agri-waste, achieving a thermal substitution rate of 16.39% in FY2025. Certified by Green-Pro and GRIHA, and backed by published EPDs, the company’s approach to sustainability earned it the Indian Circular Economy Forum Award and the Green Apple Environment Award.

Peer Comparison

Key Risks & Concerns

Dependence on Limestone Mining and Associated Risks JSW Cement’s operations heavily rely on uninterrupted access to limestone, a key input for clinker production. While it holds long-term leases for operational mines and has rights or LOIs for several others, delays in operationalising new mines, non-execution of lease deeds, or legal disputes like those involving the Nandyal and Chittapur mines pose material risks. Any breach of lease obligations or government intervention could lead to penalties, lease terminations, or disruptions in limestone supply.

High Dependence on JSW Group for Raw Material Supply JSW Cement relies heavily on JSW Steel and its subsidiaries for blast furnace slag, which accounted for 92.93% of total slag consumption in FY25. These long-term contracts carry volume-linked obligations, with penalties for under-lifting. Any disruption, non-renewal, or pricing change could affect operations. Additionally, partial fly ash and clinker needs are also sourced from JSW Group. Future conflicts of interest or supply constraints from related parties or third-party vendors pose material business risks.

Uncertainty Around Sambalpur Grinding Unit and BPSL Proceedings JSW Cement’s expansion plan faces uncertainty due to the proposed transfer of the under-construction Sambalpur grinding unit from Bhushan Power and Steel Limited (BPSL) to its subsidiary, Shiva Cement. The Supreme Court had ordered BPSL’s liquidation, later stayed pending review. Delays, cost overruns, or failure to secure approvals may hinder commissioning. Any adverse legal outcome involving BPSL may significantly impact project timelines, expansion strategy, and overall financial performance.

Outlook and Valuation

JSW Cement is one of India’s leading producers of eco-friendly cement, with an installed capacity of 20.6 MTPA across India and the UAE. The company primarily manufactures blended cement and ground granulated blast furnace slag (GGBS), using industrial by-products to reduce its carbon footprint. With integrated clinker units, grinding facilities, and strategically located bulk terminals, JSW Cement operates on a pan-India scale. Its manufacturing model is rooted in sustainability, circular economy practices, and efficient logistics, positioning it as a forward-looking player in the green building materials segment. Financially, JSW Cement’s performance has been a mixed bag, with revenue from operations staying flat over the last three years. Profit after tax went from positive Rs.104cr to negative Rs.163cr, while EBITDA grew from Rs.816cr in FY23 to Rs. 864cr in FY25.

JSW Cement aims to nearly double its cement grinding capacity from 20.60 MMTPA as of March 31, 2025, to approximately 41.85 MMTPA over the medium term. The company is also targeting an increase in clinker capacity from 6.44 MMTPA to 13.04 MMTPA. This will be achieved through a combination of brownfield expansions at existing units and greenfield projects across strategic locations in northern, central, and eastern India. Additionally, key projects include new clinker units in Rajasthan and Karnataka and the ongoing integration of the Sambalpur grinding unit in Odisha.

JSW Cement operates a resilient and forward-looking business model, anchored by its leadership in green cement and circular manufacturing practices. Cement demand is supported by the infrastructure and housing sectors, underpinned by a pan-India presence and strategic raw material integration within the JSW Group. The company’s sustained investments in low-carbon products, capacity doubling plans, and alignment with India’s decarbonization agenda provide strong long-term levers. Its environmentally differentiated product mix and supply chain efficiency position it well for the long term. However, near-term profitability will remain impacted by input cost fluctuations and expansion-related capex. We believe company’s execution needs to be watched, and performance should be monitored. Also, intense competition and massive capacity expansion in the cement industry by large well-established players means pricing & margin will remain under pressure for the foreseeable future. JSW Cement is currently valued at an FY25 EV/EBITDA multiple of 27x despite volatile margins & high debt. We recommend an AVOID rating for the issue.