JSW Steel ratings placed on watch positive after JV announcement

ICRA Limited has placed JSW Steel Limited's "AA" ratings for long-term bank facilities and non-convertible debentures on "rating watch with positive implications," effective December 12, 2025. Ratings for short-term bank facilities and commercial papers remain at [ICRA]A1+. This follows the company's December 3, 2025 announcement of a 50:50 joint venture with JFE Steel Corporation.

As part of the transaction, the steel business undertaking of Bhushan Power and Steel Limited (BPSL) will be transferred to the JV for a cash consideration of Rs.24,483 crore. JFE will acquire a 50% stake through an equity infusion of Rs.15,750 crore. Total cash proceeds to JSW Steel from the transaction, including JFE's equity infusion, are estimated at Rs.32,358 crore, with an additional deconsolidation of BPSL's net debt of around Rs.5,000 crore.

This strategic move is expected to result in a total deleveraging of approximately Rs.37,000 crore at the consolidated level, improving JSW Steel's leverage and liquidity profile. ICRA will monitor the transaction's progress, including regulatory approvals, before resolving the rating watch.