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JSW Group Chairman Sajjan Jindal has repaid loans worth ₹640 crore and released pledged shares of JSW Steel and JSW Energy.
Another tranche of promotes repayment to release pledged is expected to happen on Tuesday, said sources.
Between March 24 and 30, Jindal had released 1.09 crore pledged shares of JSW Steel worth ₹165 crore. Similarly, 5.48 crore of pledged JSW Energy shares worth ₹243 crore was also released due to loan repayment.
Shares of both JSW Steel and JSW Energy has been battered in last few trading sessions due to the ongoing Covid crisis casting cloud over the economic prospects of businesses across the globe.
Huge capital investment in capacity expansion of both the JSW Group companies amid slowing demand had triggered investors’ concern and spooked the company stocks.
When share prices are falling, promoters usually repay debts raised against their equity as the sharp fall in share price would call for additional security in the form of cash or more shares, said an analyst.
Most of the planned expansion projects of JSW Steel worth ₹15,000 crore are in the final stage of completion and would go on stream when the Indian and global economy has come to a standstill due to Corona virus infection.
Shares of JSW Steel has down seven per cent on Monday at ₹141 while JSW Energy was down two per cent at ₹44.
JSW Steel share was trading little above the 52-week low of ₹136 logged on March 23. JSW Energy had made a 52-week low of ₹34.75 on March 18.
Reducing pledge
Jindal has been repaying debt and released pledged shares of both the Group companies since last September.
So far, Jindal has repaid debt worth ₹2,350 crore in the third quarter of this fiscal. In October, he repaid Rs 1,200 crore to release 7.01 crore shares of JSW Steel accounting for 2.90 per cent of paid-up capital of the company while 11.88 crore of JSW Energy shares were released adding up to 7.24 per cent of paid-up capital.
In September, Jindal had repaid loan raised against JSW Steel share pledge worth ₹1,150 crore.
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