Home-grown stainless steel maker Jindal Stainless Ltd (JSL) on Tuesday said it is acquiring a 49 percent equity interest for a consideration of around $157 million in Indonesia-based New Yaking Pte. Ltd. The newly-entered collaboration agreement will help JSL with an ample supply of nickel pig iron (NPI).

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Jindal Stainless aims to develop, construct and operate an NPI smelter facility located in an industrial park in Halmahera Islands, Indonesia. Currently, JSL meets the bulk of its nickel requirement through stainless steel scrap and NPI/Ferro nickel.

The facility is planned to be commissioned within 2 years, with an annual nameplate production capacity of up to 200,000 metric tonne of nickel pig iron with an average of 14 percent Ni Content, said the official press release.

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It is pertinent to note that this is the first-ever strategic partnership entered into by an Indian company, it said in an exchange statement. The country’s largest stainless steel maker has taken the step to ensure the long-term availability of nickel.

"This path-breaking collaboration will enhance value for stakeholders with JSL acquiring a stake in nickel supply to create raw material security for its SS operations. This acquisition will usher a sharper competitive advantage to JSL in Indian and international markets," said Abhyuday Jindal, managing director of Jindal Stainless.

The company has additionally undertaken the development as the nickel price trend has been a key factor in the stainless steel business across the globe and the demand for it often fluctuates and remains uncertain due to geo-political issues, logistical hurdles, pandemic-induced constraints, etc.

The shares of JSL ended 4 percent lower at Rs 280 per share on Tuesday.

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