JSW Steel, India’s largest steel producer, is considering investments exceeding Rs 2 trillion over the next five years to add nearly 25 million tonnes of new capacity, driven by expectations of sustained demand growth and strong opportunities in the domestic market.

The proposed investment will be funded through internal cash flows and a measured level of debt. Capital will also be deployed towards downstream facilities for value-added products, mine development, digital infrastructure and artificial intelligence adoption.

The company’s board has approved a 5 million tonne capacity addition at a new site in Paradip, Odisha, pushing ongoing capital expenditure beyond Rs 1 trillion. Following this expansion, JSW Steel’s domestic capacity is expected to reach 47.4 million tonnes by 2030. The management indicated that several additional projects could receive board approvals over the next one to two years.

According to Joint Managing Director and Chief Executive Officer Jayant Acharya, the company’s total investment could surpass Rs 2 trillion as expansion plans progress. Beyond ongoing projects, JSW Steel is evaluating a further 5 million tonne expansion at Vijayanagar in Karnataka and a 2 million tonne green steel facility at Salav in Maharashtra. These additions could lift capacity beyond 56 million tonnes by FY31.

The company also has options to expand the Paradip plant by another 5 million tonnes, double Salav’s capacity to 4 million tonnes, and increase Bhushan Power and Steel Ltd’s capacity to 10 million tonnes from 4.5 million tonnes in partnership with Japan’s JFE Steel.

Despite multi-year lows in steel prices during the previous quarter, prices recovered from mid-December through January. JSW Steel reported EBITDA of Rs 223.35 billion over nine months, nearing its FY25 performance. Annualised EBITDA of around Rs 300 billion is expected to rise further by FY28, supported by an additional 7 million tonnes of capacity coming on stream.

JSW Steel also plans to deleverage its balance sheet by Rs 370 billion by June, following JFE Steel’s acquisition of a 50 per cent stake in Bhushan Power and Steel Ltd. This move is expected to support expansion while maintaining financial discipline.

Acharya said additional production volumes are likely to be absorbed by the domestic market, with incremental consumption of 11 million tonnes and 13 million tonnes expected in FY26 and FY27, respectively. Public expenditure is anticipated to play a key role, alongside emerging signs of private capital expenditure driven by structural reforms and tax measures.

If India’s steel consumption momentum continues, JSW Steel expects it to offset challenges in export markets, particularly Europe, where carbon border adjustment mechanisms are being implemented. The company plans to redirect volumes towards domestic and non-European markets to sustain growth.