CRISIL Reaffirms ESL Steel’s AA/Stable Rating, Strengthening Vedanta’s Steel Growth Story

Mumbai: In a significant boost to Vedanta Group’s steel business, CRISIL Ratings has reaffirmed ESL Steel Limited’s long-term credit rating at ‘CRISIL AA/Stable’ while removing the company from the “Rating Watch with Developing Implications” category. The move signals renewed confidence in ESL Steel’s financial strength, operational recovery and its growing strategic role within the newly restructured Vedanta Group.

The rating reaffirmation follows CRISIL’s review of Vedanta Group after the successful completion of its landmark corporate demerger. Alongside ESL Steel, the rating agency also reaffirmed or upgraded ratings of several Vedanta entities, underscoring the group’s strengthened financial profile.

ESL to Drive Vedanta’s Steel Growth

CRISIL said ESL Steel has become an integral part of Vedanta Iron & Steel’s long-term strategy and is expected to emerge as the largest contributor to the parent company’s earnings in the medium term. The agency highlighted that this outlook is supported by continued operational, managerial and financial backing from Vedanta Iron & Steel Limited, including unconditional and irrevocable corporate guarantees for ESL’s long-term debt.

Strong Operational Turnaround

ESL Steel registered a notable operational turnaround during the fourth quarter of FY26. According to CRISIL, production and business performance stabilized significantly, laying the foundation for sustained growth. The company also strengthened its liquidity position, with cash reserves increasing by nearly 90% year-on-year, reflecting improving financial resilience as it continues its expansion plans.

Company Sees Long-Term Growth Momentum

Welcoming the rating reaffirmation, Ravish Sharma, CEO and Whole-Time Director of ESL Steel Limited, said the decision reflects the company’s improving operational efficiency, stronger balance sheet and rising strategic importance within Vedanta Iron & Steel.

He said ESL remains focused on enhancing productivity, maintaining financial discipline and delivering sustainable growth while contributing to India’s expanding infrastructure and manufacturing sectors. According to Sharma, the support of the Vedanta Group places ESL Steel in a strong position to create long-term value for stakeholders and play a central role in the group’s future growth.

Vedanta Group Emerges Stronger After Demerger

CRISIL noted that Vedanta Group’s diversified portfolio across zinc, silver, lead, aluminium, copper, nickel and steel, coupled with its large-scale operations and cost-efficient production, continues to strengthen its business profile. The reaffirmation of ESL Steel’s rating adds to the broader positive outlook for the group’s businesses following the demerger, reinforcing investor confidence in Vedanta’s long-term growth strategy.