JSW continues to diversify, forays into defence sector

NEW DELHI: After entering the country’s crowded automobile space late last year by acquiring a stake in MG Motor India, Sajjan Jindal-led JSW Group is foraying into the defence sector with the establishment of a new business vertical, JSW Defence and Aerospace (JSW Defence).

JSW Defence on Thursday marked its entry by acquiring a majority stake in an extreme off-road vehicle company, Gecko Motors, now renamed as JSW Gecko Motors. Parth Jindal, scion of JSW Group, said, “At $73.8 billion, India as a country has a large defence budget. By 2030, Indian defence budget is likely to grow to $200 billion. Capital outlay forms a very large part of the defence budget and it is here, we at JSW see a big opportunity.”

In the last 4-5 years, the $23 billion conglomerate, which has primary interests in the steel and energy business, has been diversifying itself into various verticals either by acquisitions or setting up new units. In 2019, JSW entered into the paint business and last year listed JSW Infrastructure, its port business, on the bourses and announced ambitious plans for the auto sector, particularly in the small but fast-growing electric vehicle space.

The group has up a venture capital unit to invest in emerging businesses and has been flirting with the idea of listing its cement unit for quite some time now. “JSW is foraying into capex-heavy industries. A lot will depend on the group’s ability to raise affording funding as they are yet to start manufacturing cars or produce defence equipment in large quantity,” said a senior analyst at a leading brokerage firm.

Leave a Reply

Your email address will not be published. Required fields are marked *