JSW Cement Gears Up for Massive ₹4,000-Crore IPO—Here's What You Need to Know

JSW Cement, led by Parth Jindal and part of the JSW Group conglomerate, is expected to submit draft papers to SEBI soon for an IPO aimed at raising up to ₹4,000 crore, according to multiple industry insiders cited by Moneycontrol. The IPO would mark the first significant public offering in the cement sector since Nuvoco Vistas, backed by the Nirma group, launched a ₹5,000 crore IPO in August 2021.

Moneycontrol had earlier reported on January 10 about JSW Cement's plans to go public. One of the sources mentioned, "The plan is to file the draft red herring prospectus for JSW Cement in the coming days."

Another source added that the IPO is likely to include a fresh issue of ₹2,000 crore and an offer for sale amounting to ₹2,000 crore. The offer for sale would enable partial exits for external investors such as Apollo Global Management, Synergy Metals Investment Holding, and SBI, according to the second source.

Following the announcement of JSW Cement's IPO plans, shares of Shiva Cement surged by up to 15% in trading. Shiva Cement, acquired by JSW Group in 2017, supplies clinker—a key material in cement production—to JSW Cement.

The green cement producer aims to raise growth capital through the listing and aspires to become one of the top five cement manufacturers in India, targeting a production capacity of 60 million tonnes per annum within the next five years.

A spokesperson for JSW Group declined to comment on the matter. Notably, the October listing of JSW Infrastructure was the group's first public offering in 13 years.

Investment banks including JM Financial, Kotak Mahindra Capital, Jefferies, Axis Capital, DAM Capital, Citi, Goldman Sachs, and SBI Capital are working on the IPO.

In May, JSW Cement announced plans to invest around ₹3,000 crore in establishing a new cement manufacturing plant in the Nagaur district of Rajasthan. The greenfield integrated facility will be financed through a combination of debt and equity. Additionally, JSW Cement is reportedly in the running to acquire a promoter stake in Orient Cement. This IPO move comes amidst a fierce M&A battle in the cement industry between Ultratech Cement of the Birla group and the ACC-Ambuja combination of the Adani group.

A Closer Look at JSW Cement

In July 2021, JSW Cement secured up to ₹1,500 crore from global private equity investors Apollo Global Management Inc. and Synergy Metals Investments Holding Ltd. On April 19, 2021, Moneycontrol reported that these global investors were considering a minority stake in JSW Cement. Later, in December 2021, SBI also acquired a minority stake in the company.

As of March 2024, JSW Cement’s production capacity stood at 20.6 million tonnes per annum (mtpa), with distribution across the south (11.0 mtpa), east (5.1 mtpa), and west (4.5 mtpa) regions of India.

According to a March 1 report by Crisil Ratings, "The company plans to expand its geographical footprint by entering the northern region with a cement capacity of 5 mtpa (through a 2.5 mtpa unit in Rajasthan and a 2.5 mtpa unit in Punjab) by FY27. Along with a planned 4 mtpa brownfield expansion at its Vijayanagar unit and a 1 mtpa addition at its subsidiary Shiva Cement Ltd, the company aims to reach a total capacity of 30.6 mtpa by FY27."

For the fiscal year ending March 31, 2024, JSW Cement reported revenues of ₹5,845 crore and a profit of ₹59 crore. The company produces various types of cement, including PSC (Portland Slag Cement), OPC (Ordinary Portland Cement), CHD (Concreel HD), GGBS (Ground Granulated Blast Furnace Slag), and CPC (Composite Cement).

According to its website, JSW Cement operates manufacturing facilities in Vijayanagar (Karnataka), Nandyal (Andhra Pradesh), Salboni (West Bengal), Jajpur (Odisha), and Dolvi (Maharashtra). Additionally, through its subsidiary Shiva Cement, the company runs a clinker unit in Odisha. JSW Cement is involved in the entire value chain of building materials, including cement, concrete, and construction chemicals.

The company's portfolio of eco-friendly building materials includes "GreenCrete," marketed as India’s most sustainable RMC product, offering high durability and lower carbon emissions.