The company's MD Abhyuday Jindal, Jindal Stainless Ltd (JSL) will invest around Rs 1,300 crore to develop a greenfield Nickel Pig Iron (NPI) smelter facility in Indonesia. This will improve the safety of the company's raw materials.
According to him, JSL is the first Indian company to have nickel reserves in any offshore market, and the company gets the majority of its nickel needs from ferro nickel that continues to be in use and scrap stainless steel.
According to Jindal, the investment will be made through a joint Venture Business created with the Indonesian company New Yaking Pte. Ltd, in which JSL will own a 49 percent interest. "We have a partnership agreement with New Yaking Pte. Ltd to invest in the growth, construction, and operation of an NPI smelter facility located in an Industrial Park in the Halmahera Islands to ensure our long-term nickel supplies. According to the deal, we will pay around USD 157 million (roughly Rs 1,300 crore) in exchange for a 49 percent ownership interest "said he.
When asked about the project's timeline, Jindal said that the plant is expected to be functional in two years and have an Annual Nameplate Production Capacity of up to 2,000 metric tonnes of NPI with an average nickel content of 14%. "Due to India's shortage of nickel ore, this is the first-ever Strategic Partnership formed by an Indian Corporation to secure a share in nickel deposits abroad.
With JSL taking a share in nickel supply to create raw material security for its Stainless Steel (SS) activities, the cooperation will increase value for stakeholders, according to Jindal. The entrepreneur, this new venture will give JSL a Strategic Advantage on both the Domestic and Global Markets in regards to raw material security and the cost of producing stainless steel, since nickel accounts for 50% of that cost alone.
He further stated that internal accruals are going to be utilized primarily to finance the Projected Investment. There will be two payments for the investment. Around Rs 750 crore in 2023–2024 and an extra Rs 550 crore in 2024–25. A prominent producer of stainless steel in India and a member of the O P Jindal Group, Jindal Stainless has an annual melting capacity of over 2.9 million tonnes. In addition to an Overseas Production Facility in Indonesia, it owns two manufacturing complexes in Haryana and Odisha. Moreover, it operates one service center in Spain and six in India.