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  5. JSW Steel shares rally 2%: Check what analysts said after firm’s JV with Japan’s JFE Steel

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JSW Steel shares rally 2%: Check what analysts said after firm’s JV with Japan’s JFE Steel

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By Ahana Chatterjee

4 min read | Updated on December 04, 2025, 11:51 IST

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SUMMARY

Under the partnership, the steel business undertaking of JSW Steel’s subsidiary, Bhushan Power and Steel, will be transferred to a 50:50 joint venture with JFE by way of a slump sale for a cash consideration of ₹24,483 crore

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In a separate filing, JSW Steel had also informed that it entered into a strategic joint venture partnership with Japan’s JFE Steel Corporation. | Image: Shutterstock

In a separate filing, JSW Steel had also informed that it entered into a strategic joint venture partnership with Japan’s JFE Steel Corporation. | Image: Shutterstock

Shares of JSW Steel gained nearly 2% to an intraday high of ₹1,165 on Thursday, December 4, after the firm completed the acquisition of Saffron Resources Private Limited and also formed a joint partnership with Japan’s JFE Steel.
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“…we hereby inform you that the Company has completed the acquisition of 100% equity interest in Saffron Resources Private Limited (“Saffron”) today, i.e., December 3, 2025, in accordance with the Share Purchase Agreement as amended from time to time. Consequently, Saffron has now become a wholly-owned subsidiary of the Company,” the company had said in a regulatory filing on Wednesday.

The stock has also rallied after analysts shared a positive outlook for JSW Steel after the firm formed a JV with JFE Steel Corporation.

In a separate filing, JSW Steel had also informed that it entered into a strategic joint venture partnership with Japan’s JFE Steel Corporation.

Under the partnership, the steel business undertaking of JSW Steel’s subsidiary, Bhushan Power and Steel Ltd (BPSL), will be transferred to a 50:50 joint venture (JV) with JFE by way of a slump sale for a cash consideration of ₹24,483 crore, it added.

BPSL owns an iron ore mine and an integrated steelworks in eastern India with a crude steel production capacity of 4.5 million tonnes per year, JFE said in a separate regulatory filing.

The regulatory filing stated that JFE will invest a total of ₹15,750 crore in two tranches for a 50% stake in the JV.

JSW Steel acquired BPSL in 2021 through the Insolvency and Bankruptcy Code (IBC) process.

Commenting on the development, Jayant Acharya, Joint Managing Director and CEO of JSW Steel, said, “Today’s announcement brings together JSW’s expertise in India with JFE’s technological strengths and will enable the joint venture to realise its growth potential and produce a variety of value‐added steels. India is the fastest-growing major economy as well as steel market in the world, and this transaction enables JSW to accelerate its growth in a financially prudent manner and create further value for its stakeholders.”

JFE said that the JV aims to expand crude steel production at the integrated steelworks to 10 million tonnes by 2030.

Here is what analysts

Global brokerage firm BoFA, in a note, has said JSW Steel’s partnership with JFE will help deleverage JSTL's balance sheet meaningfully ahead of the next leg of capacity expansion.
Further, analysts at JP Morgan have said the JV is largely neutral to slightly positive over the medium term. The enterprise value of the deal at ₹53,000 crore (₹31,500 crore equity and ₹21,000 crore debt) implies an attractive EV/EBITDA multiple of 17x/11x on JPMe FY26/27E for BPSL.

The analysts also said that the deal will deleverage its balance sheet by ₹37,000 crore (effectively reducing ND/EBITDA by ~0.8x on JPMe) and/or provide improved BS strength to pursue accelerated capacity expansions. It will enable continued collaboration on value-added products with JFE (such as automotive steel and grain-orientated electric sheets).

Analysts at CLSA said the deal values BPSL at ₹53,000 crore, implying US$1,400/tonne of capacity and a forward EV/Ebitda of 13x. This estimate leads to a sharp reduction in JSW’s leverage and value accretion of ₹30-₹70/share. “For JFE, it provides operational access to a high-growth market. We expect JSW to react positively to this transaction,” CLSA said in a note.
Analysts at Jefferies see JSTL's decision to transfer its subsidiary, BPSL, as broadly neutral for EPS estimate and fair value. They said the transaction will strengthen JSTL's balance sheet, reducing its FY27E net debt/EBITDA from 2.4x to 1.7x.
Nuvama analysts said JSTL’s consolidated FY28E EBITDA will reduce by 11% and net debt by 50% (₹37,350 crore). “Reckon the deal shall be value-accretive for JSTL, as not only is the stake being sold at a higher value, but it also infuses cash into the business. This deal is likely to enhance JSTL’s fair value by ₹37/share,” the note read.

JSW Steel share price

At 11:40 AM, JSW Steel shares were trading at ₹1,145.70 apiece on NSE, rising 0.18%.

Over the past five trading sessions, shares of the company have lost 1.4%, while they have fallen 3% in a month. In the last six months, the stock has jumped more than 18% and 27% from the beginning of the year.

JSW Steel has a total market capitalisation of ₹2.8 lakh crore, according to NSE data.

Shares of the steel major had hit a 52-week high of ₹1,223.90 on October 29, 2025, and a 52-week low of ₹880 on January 13, 2025.

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About The Author

Ahana Chatterjee - image.jpg
Ahana Chatterjee is a business journalist with 7 years of experience across several leading news platforms. At Upstox, she covers stock markets and corporate news.

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