JSW Cement signs $50 mn sustainability-linked loan agreement with BNP Paribas

JSW Cement, a subsidiary of the $22 billion JSW Group, has entered an agreement for a sustainability-linked loan (SLL) with BNP Paribas, to secure $50 million (approximately Rs 414 crore). The capital raised through this agreement will be utilised by JSW Cement to support its capacity expansions, aligning with its long-term objective of achieving a cement-making capacity of 50 million tonnes per annum (MTPA) in India. This marks the second instance in six months that JSW Cement has raised green debt capital, taking its SLL-based funding to $100 million. 

Parth Jindal, Managing Director of JSW Cement, said, “This is our second SLL in a short span of six months. In the last eight years, we have grown our production capacity by four times while reducing our carbon emission intensity by half.  This strategic financing will support JSW Cement in making its green cement & building material product portfolio available to consumers across the country.  The SLL raised from BNP Paribas underscores our continued commitment to our ESG goals.  The new capital will enable us to fund our capacity expansion with the long-term target of achieving 50 MTPA capacity.” 

BNP Paribas acted as the mandated lead arranger and bookrunner (MLAB) as well as the sustainability loan coordinator for this transaction. DNV Business Assurance India (DNV) served as the provider of the second-party opinion (SPO). This transaction represents a significant milestone in JSW Cement’s strategic journey towards building a sustainable business. 

Sanjay Singh, CEO and Head of Territory at BNP Paribas India, said, “As a global leader in sustainable finance, BNP Paribas is committed to foster sustainable social and economic development across businesses, operations and communities; while we partner with our clients in their transition toward a more sustainable economy.  In this regard, the acceleration of green transition of the ‘hard to abate’ sectors will be key to India meeting its net-zero target.” 

Recognising the importance of green capital as part of its business strategy to reduce carbon footprint, JSW Cement is pursuing the goal of creating a sustainable future for India through its Green cement portfolio. The company has chosen to measure performance against the sustainability performance target (SPT) through one key KPI of net CO2 emissions intensity, calculated as kilo of CO2 per tonne of cementitious material produced (Kg CO2 per tcm) covering its entire manufacturing operations comprising integrated cement plants and grinding units.