Jindal Steel & Power prepays $357-million loan of Mauritius subsidiary to clear entire debt

Jindal Steel & Power Ltd said it has prepaid a loan of $357 million of its wholly-owned subsidiary Jindal Steel & Power (Mauritius) (JSPML).

The prepayment will help clear the entire debt of JSPML. The loan also had corporate guarantees from JSPL India, which will also get released, the company said in a release.

Over the past three years, JSPL "has been able to reduce its overseas debt from $1.8 billion to $130 million post this payment". The bulk of JSPL's overseas debt now sits in its Australian subsidiary ($113 million), it added.

"The Group plans to repay this loan by September 22. JSP Group's net debt has come down from a peak of Rs 46,500 crore to Rs 10,981 crore in December 2021," the release said.

In September last year, JSPL had announced making a prepayment of $106 million to the lenders of its arm Jindal Steel & Power (Australia) Ltd.

Commenting on the latest prepayment, JSPL MD V R Sharma said, "We are pre-paying our lenders to further strengthen our balance sheet and we want to become a net debt-free company by FY23 through accelerated deleveraging. The company is aligned with the India growth story. We will expand our steelmaking capacity to over 15 MTPA by 2025."

According to additional information provided by the company, the Mauritius-based subsidiary is the holding company for its overseas mines and minerals assets.

"The loan was taken for acquiring mines and mineral assets to primarily provide raw material security to JSPL India steel operations," it said.