JSW Steel Integrated Report 2021-22

Strategic priorities

Progressing on our six focus areas

At JSW Steel, we realise our #BetterEveryday proposition through six well-established strategic focus areas. These areas were delineated after careful consideration of our material issues, growth imperatives, and internal and external drivers of growth. In FY 2021-22, we significantly progressed on these areas through targeted initiatives and delivered on all key performance indicators.

Strategy formulation process

Our strategic planning and formulation activity is based on stakeholder expectations and concerns as well as the short-, medium, and long-term objectives of the business.

In alignment with the integrated approach to strategy development, we believe in building on our internal synergies while closely analysing our macro-environment.

A strategy meet of the Board of Directors is held once every financial year to formulate, evaluate and approve our business strategy. The meeting focuses on our strategic goals, financial management policies, management assurances and control aspects, and the growth plan of the Company.

Through such discussions we have arrived at our strategic pillars that propel business growth across all aspects.

Strategic growth

Expanding our installed capacity through organic and inorganic routes to capitalise on opportunities and align with India’s growth story

Capitals deployed

Capitals enhanced

Diversification of product profile and customer base

Innovating and offering value-added and differentiated products with a strong branded portfolio

Capitals deployed

Capitals enhanced

Note: Please note that any strategic action we undertake involves the utilisation of and impact on all our six capitals. However, the information presented above captures only the most significant capital linkages, with respect to specific strategic focus areas.

Backward integration and raw material security

Securing raw material supply through captive mines, long-term contracts, and an efficient supply chain

Capitals deployed

Capitals enhanced

Focus on resource optimisation and digitalisation

Achieving cost efficiency and maximising resource utilisation through varied interventions across operations and led by digitalisation

Capitals deployed

Capitals enhanced

Prudent financial management

Maintaining an optimal capital mix and diversifying our debt profile while powering our growth ambitions

Capitals deployed

Capitals enhanced

Mainstreaming sustainability in business imperatives

Embedding good governance and economic, environmental, and social sustainability into everything we do to create value for our stakeholders

Capitals deployed

Capitals enhanced

Financial Capital

Manufactured Capital

Intellectual Capital

Human Capital

Natural Capital

Social & Relationship Capital

Progressing on our six focus areas

Strategic priority	FY 2021-22 Update	Near-term outlook	KPIs
Strategic growth	Annual capex is at `14,198 crore Commenced 5 MTPA brownfield expansion project at Vijayanagar with a capex of `20,000 crore Incremental expansion at Vijayanagar of existing facilities to enhance capacity Increased stake in BPSL to 83.3% in FY 2021-22 Recorded improved profitability for all our aquisitions	Complete the capex projects as per stated plan and reach steelmaking capacity of 37 MTPA in India by FY 2024-25	Total domestic installed capacity Total downstream capacity Market share
Diversification of product profile and customer base	Obtained an Environmental Product Declarations (EPD’s) – Type III eco-labelling for all finished products from three integrated steel plants All finished products under lifecycle analysis Progressing across our downstream expansion projects New products developed Increased connect with retailers and expanded presence to ~75% of India	Complete the downstream projects as per capex plan Effective influencer management – aim for >10% increase in base of masons, contractors, architects and engineers in the Privilege Club Loyalty Program Enrich product mix by addition of value-added products – Seismic Resistant Steel and Binding Wires Providing retail solutions using technology – launch of Distributor Management Services on digital platform	New grades developed Domestic market share Domestic to export sales mix Number of retail outlets
Backward integration and raw material security	Acquisition of iron more mines in Odisha presents us with various benefits Secured coal mines, ensuring raw material availability	Continue operations across the acquired mines that meet the cost-efficiency and sustainability goals of the business Enhance mining capabilities and efficiencies at Odisha with an estimated capex of `3,450 crore to reduce reliance on outsourced mining; expected completion within two years Add grinding and washing facilities to improve the quality of ore, aiding higher productivity at the steelmaking operations Continue to focus on enabling better logistics handling Evaluate and develop a slurry pipeline in Odisha, connecting Nuagaon mine with Paradip port	Captive iron ore consumption Total capacity of the Group’s captive power plants
Focus on resource optimisation and digitalisation	Set up of 8 MTPA pellet plant and 1.5 MTPA coke oven plant at Vijayanagar Set up 175 MW and 60 MW power plants at Dolvi Progressing across Industry 4.0 digital initiatives Introduced virtual reality (VR)-based fire-safety trainings	Improve efficiency and boost safety through yard management automation Project SAMPARK - Paperless technology powered logistics Digitally enabled finance function Analytics to optimise Vijayanagar SMS process time and energy burden Holistic digital cultural transformation agenda	Capacity utilisation Conversion cost per tonne of steel Iron ore transported using pipe conveyor
Prudent financial management	Spent `14,198 crore on capex projects Total debt stood at `56,650 crore at the end of FY 2021-22 Became the first steel company globally to raise Sustainability Linked Bonds	Rating upgrade across domestic and international agencies Acquiring assets via IBC, with minimal impact on balance sheet	Net debt to equity Net debt to EBITDA
Mainstreaming sustainability in business imperatives	JSW Group joins the World Business Council for Sustainable Development Received an A-band from CDP for the best practices Started using power from 225 MW Renewable Solar power at Vijayanagar Conducted wellbeing and wellness workshops on the topics of Resilience, Emerging Stronger and Recharge for Action through JSW We Care Launched India’s first ‘Skill Impact Bond’	Continue focus on health and safety management Continue decarbonisation and emissions control in line with stated targets Continue emphasis on conservation initiatives, implementation of best available technologies (BATs) towards decarbonisation, focus on circularity, hydrogen economy and responsible product stewardship towards sustainable steel Make conscious efforts to enhance diversity in the workforce	~~Scope~~ CO₂ emissions Specific energy consumption Water consumption Air Emissions (PM, SOx, NOx) Waste utilised, recycled and reused