High values of stressed steel assets reflect uncertainty over greenfield

The upturn in the steel cycle is already in its second year

The valuations fetched by the larger stressed steel assets — Bhushan Steel and Bhushan Power & Steel — are partly a reflection of the uncertainty associated with greenfield projects in India.

So far, JSW Steel’s offer of Rs 193.5 billion for Bhushan Power & Steel, which has a commissioned capacity of 2.3 million tonnes (mt) of steelmaking, is the highest. However, though Bhushan Power’s commissioned capacity is 2.3 mt, it has a planned capacity of 3 mt. Also, Bhushan’s promoters had earlier submitted a plan to ramp-up capacity to 5 mt.

JSW revised its bid from the earlier