CRISIL Reaffirms ESL Steel’s AA Rating -Backing Vedanta Group’s Steel Growth Ambitions
Mumbai, July 18, 2026: CRISIL Ratings has reaffirmed ESL Steel Limited’s, long-term rating at CRISIL AA/Stable, removing it from “Rating Watch with Developing Implications”. This is a vote of confidence in the strategic direction of Vedanta group’s steel business as it scales toward becoming a major contributor to the group’s earnings. The agency noted ESL “is an integral part of Vedanta Iron and Steel’s (NSE: VISL) value chain and long-term business strategy”
The action is part of CRISIL’s comprehensive review of the Vedanta group following the successful completion of its landmark demerger, alongside upgrades for Vedanta Limited (NSE: VEDL), Vedanta Aluminium (NSE: VAML), and Vedanta Oil & Gas (NSE: VOGL), and Vedanta Power’s (NSE: VEDPOWER) guaranteed facilities to AA+(CE).
A steel business central to Vedanta’s next chapter: CRISIL’s rationale is unambiguous about ESL’s importance within the group, that it is expected to emerge as the largest contributor to Vedanta Iron and Steel’s earnings in the medium term. This confidence is backed by continued strong operational, managerial, and financial support from parent Vedanta Iron & Steel Limited, including unconditional and irrevocable corporate guarantees on ESL’s long-term debt.
Recovery momentum building: ESL’s operations stabilised and improved meaningfully in the fourth quarter, with management expecting this improved performance to sustain going forward even as expansion continues. CRISIL’s liquidity assessment reflects this resilience: cash and equivalents rose to ₹464 crore, up nearly 90% from ₹245 crore a year earlier, further supported by the financial strength of parent Vedanta Iron and Steel.
Part of a stronger, more focused group: ESL’s reaffirmation adds to a broader picture of credit strength across Vedanta following its demerger. At the group level, CRISIL noted net debt to EBITDA improved to 2 times in fiscal 2026, from 2.55 times a year earlier – with continued improvement expected, reinforcing the financial foundation supporting ESL’s growth plans. CRISIL emphasized the group’s overall strength: “Vedanta Group has a diversified metals portfolio spanning zinc, silver, lead, aluminium, copper and nickel. The large scale of operations with a healthy market share and the cost-efficient operations in its segments strengthen the Group’s operating profile.”
Loading ...