ArcelorMittal Nippon Steel India (AMNS India) is setting its sights on a sharp capacity expansion, underlining its long-term confidence in India’s steel demand. The company plans to raise its steelmaking capacity to 25–26 million tonnes by 2030, almost three times its current scale, Chief Executive Dilip Oommen has said.
The growth strategy rests on two pillars: a major expansion of its existing Hazira plant in Gujarat and the development of a new greenfield facility in Andhra Pradesh. Together, these projects will significantly alter AMNS India’s footprint in the country’s steel landscape.
At present, the company operates with a capacity of around 9 million tonnes per annum. The first phase of expansion involves ramping up the Hazira plant to 15 million tonnes by next year. This will be followed by a further increase to 18 million tonnes. In parallel, AMNS India is building an 8.2 million tonnes per annum greenfield steel plant at Rajayyapeta in Anakapalli district of Andhra Pradesh. The new facility is expected to be commissioned around 2030.
The expansion comes with a heavy investment commitment. AMNS India is expected to invest between Rs. 55,000 crore and Rs. 60,000 crore during the three-year period from FY26 to FY28. These funds will not only support new steelmaking capacity but also strengthen the company’s raw material and logistics backbone.
A key focus area is pellet-making capacity, which the company plans to scale up to around 12 million tonnes each in Odisha and Andhra Pradesh. Investments are also being made in ports and mining assets to ensure smoother supply chains as production rises. Alongside this, AMNS India is pushing hard on sustainability, with plans to develop about 7 gigawatts of renewable energy capacity by 2032. This move is aimed at reducing energy costs and lowering the carbon footprint of its operations.
Credit rating agency Crisil has assigned AMNS India a long-term rating of AA+, reflecting confidence in the company’s financial strength and execution capabilities. Crisil expects the company to report consolidated revenue of around Rs. 51,100 crore in FY25, with Ebitda exceeding Rs. 5,000 crore.
However, the road ahead is not without challenges. The steel industry in India is currently under pressure from high input costs and weak steel prices. Iron ore prices remain elevated, while steel prices have softened, squeezing margins across the sector. Oommen has pointed out that this combination makes it difficult for steelmakers to fund large expansion plans while maintaining healthy profitability.
While AMNS India meets a significant portion of its iron ore requirements from captive mines, the company expects dependence on external sources to rise as capacity expands. Analysts note that low-cost imports have added to the pressure, pushing domestic steel prices to their lowest levels in nearly five years.
The industry has been seeking policy support to ease these pressures, particularly reforms to lower the cost of iron ore. Although discussions were held at a high level in August, progress has been slow. Mineral-rich states are concerned about potential revenue losses, while iron ore miners have opposed export duties. An advisory committee set up to suggest reforms has not met for over two months, leaving steelmakers in a wait-and-watch mode.
As it expands, AMNS India is also making a clear strategic choice. The company will focus entirely on flat steel products, such as coils and sheets, which are widely used in automobiles, consumer appliances and industrial manufacturing. This sets it apart from peers like Tata Steel, JSW Steel, Jindal Steel and SAIL, which produce both flat and long steel products. By specialising in flat steel, AMNS India aims to position itself as a key supplier to high-growth manufacturing sectors.
The company’s recent financial performance provides some comfort amid current market uncertainty. In FY24, AMNS India reported a profit of Rs. 7,325 crore on revenues of Rs. 54,605 crore, with Ebitda of Rs. 9,344 crore. While margins are expected to remain under pressure in the near term, the company believes its scale, integration and focus on efficiency will help it navigate the cycle.
If executed as planned, AMNS India’s expansion could significantly boost India’s domestic steel production capacity and support the growth of downstream industries such as automobiles, infrastructure and consumer durables. It also signals a strong, long-term commitment by global steel majors to the Indian market.
That said, the success of this ambitious plan will depend on how well the company manages costs, secures raw materials and navigates policy and market headwinds. For now, AMNS India is betting that India’s steel demand story will outweigh short-term challenges, making the next decade a defining one for the company.
