Shares of JSW Steel Ltd plummeted 6.5% after touching a day’s high of Rs 1,037 on 2nd May, following the Supreme Court’s ruling that termed the Bhushan Power & Steel resolution plan—won by JSW Steel—as “illegal.”

JSW Steel acquired a 49% stake in Bhushan Power and Steel in 2021 through the Insolvency & Bankruptcy process, gaining 2.75 MTPA steel-making capacity in Odisha. The stake was raised to 83% by October 2021.

The Supreme Court has struck down the resolution plan and ordered Bhushan Power’s liquidation.

The first reason cited was using a mix of equity and optionally convertible debentures, whereas the Court had ruled it should be done using equity alone.

The second reason was the failure to complete the resolution plan within the stipulated timeline.

Lawyer HP Ranina stated that JSW Steel’s only option is to file a review petition, agreeing to complete the takeover using only equity.

Bhushan Power currently contributes about 10% to JSW Steel’s EBITDA and 12.5%–13% of its total capacity of 37.5 MTPA.

At 12:40 PM, the shares of JSW Steel were trading 6.71% lower at Rs 960.70 on NSE.

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