TOWARDS A GREENER, STRONGER FUTURE

Evolving with India for a Better Tomorrow

At JSW Steel, we see an opportunity to create value for stakeholders through
long-term growth with a focus on sustainability in every way. As India progresses towards its ambitious goal of becoming a developed nation by 2047, we are committed to contributing to this trajectory by expanding our capacities, enhancing our product capabilities, optimising our costs and raw material security, while focusing on environment, people and communities, with our commitment to Zero Harm. This is a transformational journey for JSW Steel, which we believe will redefine us, and closely link us with India's growth.

We are expanding capacity, at a steady pace, at one of the lowest specific capex costs globally while maintaining our leadership in conversion costs. We are strengthening our downstream product capabilities to offer more value-added products, focusing on customer-centric innovation, enhancing raw material security, driving end-to-end digitalisation, and enhancing our sustainability quotient.

We are currently on a clear path to expand our capacity to 43.5 MTPA by September 2027, with a target of reaching 51.5 MTPA by FY 2030-31. Our capital expenditure and expansion programmes are progressing as planned, with a consolidated capex expected to be `20,000 crore for
FY 2024-25.

India's domestic steel demand has grown at double-digits over the past two years on the back of sustained economic growth. However, the global steel demand environment remains tepid, with divergent growth outlook across regions. With China’s property sector yet to recover, there is risk of the production from overcapacity being diverted to India. This adds pressure on margins for domestic steelmakers, despite a buoyant demand environment across
steel-consuming industries.

Despite these challenges, we achieved 100% of our production and sales guidance for FY 2023-24 and recorded our highestever volume in value-added steel product sales, which accounted for 61% of our total sales. Our average capacity utilisation in FY 2023-24 reached an impressive 92%, highlighting our ability to sweat our assets. Our consolidated revenue from operations was `1,75,006 crore, with an EBITDA of `28,236 crore, underscoring our operational excellence. Our capacities are being supported by raw material security for iron ore and coking coal. We have actively participated in open auctions for both iron ore and coking coal in the recent past. To date, we have secured
24 iron ore mines in India with resources of 1.3 billion tonnes, of which 13 iron ore mines in Karnataka and Odisha have been operationalised while the rest are at various stages of commissioning. Three coking coal mines have been secured in India, and we have recently announced the acquisition of Minas de Revuboe, a predevelopment asset in Mozambique, which provides us with access to over 800 million tonnes of premium hard coking coal reserves. We plan to commission our three coking coal mines in India, acquired through the auction route, over the next two years, which will add about 2 MnT of coking coal supply.

Transforming into a future-ready digital organisation

Our digitalisation endeavours span across functions, such as sales and marketing, manufacturing and mining, sustainability, safety and security, supply chain management, human resources, and finance areas. We are implementing automation, integration and intelligence with end-toend functional transformation to develop a future-ready digital workforce.

We have made significant strides in digitalising mine planning and operations. This includes the implementation of 3D mine planning and geological modelling to enhance mine designs, alongside a comprehensive digital mine operations management system for optimised scheduling, allocations, operational control, and reporting. In logistics, our Pit-to-Plant Digital Logistics Management system incorporates RFID-based vehicle authorisation and automated man-less weighbridge operations. These innovations have not only optimised dispatch scheduling but also halved the overall turnaround time (TAT), with a remarkable 57% reduction in TAT for railway rake operations. Under Project Sampark, we are undertaking end-to-end transformation of logistics management, which will reduce logistics costs, enhance workplace safety and provide complete visibility of vehicle movements. We are not only enhancing our operational efficiency but are also building a future-ready digital workforce.

Empowering our workforce, extending our peoplefirst philosophy

At JSW Steel, our commitment to a people-first philosophy has never been stronger. This year, we furthered our dedication to empowering our diverse workforce through various initiatives including the establishment of the JSW Steel Diversity Council. This council underscores our commitment to fostering an inclusive environment that promotes diversity, equity, and inclusion throughout our operations.

We continue to position ourselves as a preferred employer by investing in the personal and professional development of our employees and adopting industry-leading practices. Our efforts to cultivate an inclusive workplace include leadership workshops and bias mitigation programmes, particularly benefitting women and minority groups. Additionally, we launched the ‘Empower U’ learning series tailored to the unique needs of our women employees, as identified through diversity surveys. Our Women of the Future programme offers a bespoke development journey, preparing them for leadership roles and enhancing their career potential. These initiatives are pivotal to our growth strategy, ensuring that as JSW Steel advances, it does so with a workforce that is skilled, diverse, and fully empowered.

Championing safety at work, sustainability embedded

In our pursuit of 'Zero Harm', we have made significant strides in enhancing safety across all operations. We aim to be recognised as one of the world's safest organisations by 2030, a goal we are steadily approaching by integrating advanced safety systems and fostering a culture of accountability. This year, we added a Safety Experience Centre at our Dolvi Works, following on the success of a centre in Vijayanagar. These centres are equipped with Virtual Reality and Augmented Reality technologies, to significantly enhance safety training and awareness among our employees and contractors.

At JSW Steel, our sustainability initiatives are both ambitious and strategic, and during the year, we announced a target of achieving Net Neutral emissions by 2050. The short-term initiatives to achieve this target will be improving energy efficiency, transitioning towards renewable energy, improving material quality, increasing circularity, improving process efficiencies as well as utilising alternative fuel sources. The medium and long-term initiatives to reach Net Neutral by 2050, include commercial deployment of green hydrogen for steelmaking, use of syngas, reuse of top gases recycled back into the furnace, scrap-based electric arc furnace, carbon offset, sequestration as well as commercial implementation of carbon capture, use and store. These initiatives not only aim to reduce our operational costs but also to enhance our process and energy efficiencies, fostering a more circular economy in our operations.

We plan to establish a green steelmaking facility with a capacity of 4 MTPA on the western coast of India, in response to the EU’s Carbon Border Adjustment Mechanism (CBAM) and rising demand for low carbon emission steel. This reflects our proactive approach to integrating new technologies and practices that contribute to a sustainable future. While the full commercial viability of green steel on a large scale continues to develop, we are committed to pioneering efforts in this area, ensuring that JSW Steel remains at the forefront of industry advancements and regulatory compliance

Catalysts of comprehensive societal progress

We see ourselves not merely as a world-class, industryleading steel manufacturer but driving positive change and inclusive progress. Our commitment to driving meaningful change encompasses a wide array of critical areas including health and nutrition, agriculture, water, environment and sanitation, education, waste management, skill development, art, culture, heritage, and sports.

We take pride in our JSW Shakti initiative, an all-women BPO that empowers 285 women with skills essential for customer service, IT infrastructure management, and soft skills, promoting both empowerment and professional growth. In education, our efforts to transform schools in North Karnataka are complemented by the 'JSW Room to Read' project, which has significantly improved reading habits among students and revitalised school infrastructures in Maharashtra, creating nurturing educational environments. These initiatives reflect our broader mission to make a positive impact on the communities we serve.

In conclusion

At JSW Steel, our transformative journey has consistently mirrored the evolving economic landscape of India. From adeptly navigating past shifts in the economy to leveraging these changes for robust growth, we have always been at the forefront of change. Today, our commitment to innovation and sustainability shapes our strategic responses to global economic dynamics, including supply chain challenges and market fluctuations. At the same time, we are touching more than a million lives through our social initiatives, including supports to 1,12,000 children with daily nutritious meal and enabling specially abled children at Tamanna School to process instructions better, improve social skills and teamwork.

As we continue to progress, our unwavering dedication to excellence drives us to elevate performance benchmarks, creating substantial value for all our stakeholders. I am deeply grateful for the enduring trust and support of our stakeholders, which fuel our journey.

Together, we are charting a course towards a future that is not only prosperous but also inclusive and sustainable. This ongoing transformation at JSW Steel is a testament to our ability to adapt to the present while proactively shaping our future with strategic foresight.

Warm regards,

Jayant Acharya

Joint Managing Director and CEO