Shares of JSW Steel jumped 7 percent to hit a new 52-week high on Thursday after the company announced the commencement of production at Dolvi Works facility.

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The sentiment was also lifted after credit rating agency Moody's Investors Service upgraded the outlook on the company's ratings to stable from negative, led by a strong recovery in operating performance.

The stock rose as much as 7 percent to its 52-week high of Rs 500.85 per share on the BSE.

"The rating affirmation and outlook change to stable are driven by a solid recovery in JSW's operating performance in the third quarter of the fiscal year ending March 2021. We believe JSW will sustain the improvement over the next 12-18 months, enabling recovery in its financial metrics to levels more appropriate for its Ba2 CFR," said the agency.

The firm commenced production of Hot Rolled Plates from the new 5 MTPA Hot Strip Mill facility at its Dolvi Works. The Dolvi Works has an existing capacity of 5 MTPA.

Earlier this week, the firm also completed the acquisition of the manufacturing business of high-grade steel plates and coils of Welspun for Rs 848.5 crore. JSW shall also purchase a parcel of land from Welspun Steel for Rs 1.50 crore.

Meanwhile, Moody's further noted that that the rating action also reflects JSW's acquisition of Bhushan Power and Steel (BPSL), which we view as strategic to the business. BPSL's value-added product offering and proximity to JSW's iron ore mines will further strengthen the company's business profile while adding scale, it added.