JSW Cement signs First Sustainability Linked Loan of Rs 400 crores with MUFG Bank

JSW Cements

Pune, October 3, 2022 – JSW Cement, India’s leading Green Cement company, has signed its First Sustainability Linked Loan of Rs 400 crore (US$ 50 million) with MUFG Bank India. It plans to deploy these funds as capital expenditure to achieve its capacity target of 25 MTPA with an increasing focus on sustainability. The cement sector has been highly carbon intensive. JSW Cement recognizes the role green capital can play in transitioning business operations to a low carbon footprint. MUFG Bank acted as the Mandated Lead Arranger and Bookrunner (MLAB) and the Sustainability Loan Coordinator for this transaction. DNV Business Assurance India (“DNV”) acted as the Second Party Opinion (“SPO”) provider. This transaction marks several milestones, including the first Sustainability Linked Loan for JSW Cement. It is also MUFG’s first transaction undertaken out of its new branch at Gujarat International Finance Tec-City (GIFT City), which was launched in August 2022 as part of an enhanced service footprint to respond to the bank’s corporate clients.

JSW Cement is pursuing the goal of creating a sustainable future for India through its Green cement portfolio. MUFG Bank is committed to empowering companies pursuing such sustainable goals in its operations. This landmark financing further reaffirms JSW Cement’s status as a pioneer in making sustainable cement available to every Indian consumer and MUFG Bank supports this ambition.

According to Mr. Parth Jindal, Managing Director of JSW Cement, “The Sustainability Linked Loan raised from MUFG Bank reiterates our purpose of pursuing sustainable business growth while ensuring a sustainable future for the next generations. The new capital will enable us to meet our goal of achieving 25 MTPA capacity in the near term.”

Mr. Shashank Joshi, Deputy CEO of MUFG India said, “Through this transaction, JSW Cement has not only reaffirmed its sustainability vision but served as a leading flag-bearer for the industry’s net zero transition. With our market-leading ESG financing capabilities, MUFG has long played a defining role in the sustainability journey of India’s corporate sector. We congratulate JSW Cement on its first Sustainability Linked Loan and are pleased to be able to support JSW Cement in its ongoing mission to provide sustainable products through this landmark transaction”.

JSW Cement has developed a Sustainability-Linked Loan Framework to link its capital-raising with long-term ESG objectives. This will enable JSW Cement to meet its ambitious timelines for achieving an improved sustainability performance. The Sustainability-Linked Loan Framework is also aligned with the Sustainability-linked Loan Principles (“SLLP”) administered by the Loan Market Association, Asia Pacific Loan Market Association, and Loan Syndications & Trading Association in March 2022. As the Sustainability Loan Coordinator, MUFG Bank worked with JSW Cement to publish its Sustainability-Linked Loan Framework, underpinning the current deal and any other similar transactions that JSW may choose to undertake in the future.

JSW Cement has chosen to measure performance against the Sustainability Performance Target (SPT) through one key KPI of Net CO2 emissions intensity, calculated as Kg CO2 per tons of cementitious material produced (Kg CO2/TCM) covering its entire manufacturing operations comprising integrated Cement plants and grinding units.