Indian steel giant Jindal Stainless acquires 9.62% stake in M1xchange

Indian steel giant Jindal Stainless, along with its wholly owned subsidiary, Jindal Stainless Steelway Limited, has acquired a 9.62% stake in M1xchange, an RBI-licensed Trade Receivables Discounting System (TReDS) platform. 

The deal involved a combination of primary capital and a secondary purchase of shares from existing shareholders.

With this investment, M1xchange will continue to focus on enabling seamless access to working capital for MSMEs and corporates, further strengthening the digital supply chain financing ecosystem in India.

Enhancing liquidity in the ecosystem

Jindal Stainless' support will enhance liquidity in the ecosystem, helping vendors and customers gain faster access to affordable credit.

Additionally, the partnership will help Jindal Stainless digitise the financing operations, simplifying payment processes, accelerating its broader digitalisation efforts, as well as reducing the overall working capital cycle, thereby enhancing operational efficiency across the supply chain structure.

Leadership comments

Commenting on this development, the Managing Director of Jindal Stainless, Abhyuday Jindal, said, "At Jindal Stainless, we recognise that access to timely and affordable financing is a crucial growth enabler for businesses, especially MSMEs. This investment will have a two-pronged advantage – it will empower our domestic and international channel partners – both upstream and downstream; and provide enhanced liquidity to further strengthen JSL's balance sheets."

Anurag Mantri, ED and CFO at Jindal Stainless said, "The scale and reach of Jindal Stainless combined with the full suite of digital supply chain financing solutions at M1Xchange, including GIFT City offerings, would revolutionize traditional financing practices and pave the way for cheaper credit access for its entire global value chain, including the deep-tier channel." 

"This investment by Jindal Stainless Limited marks a significant milestone in M1xchange's journey of innovation, technology, and growth. Our suite of supply chain finance solutions, including TReDS for the domestic market, ITFS (GIFT City) for the global market, and our Channel Finance solution through Mynd Fintech, will empower JSL and its ecosystem partners to enhance growth and competitiveness," said Sundeep Mohindru, Promoter & Director, M1xchange.

What does M1xchange do?

M1xchange connects MSMEs with banks and financiers through its marketplace exchange platform, enabling faster access to capital.

With the M1xchange TReDS platform, MSMEs can auction their invoices at competitive rates via a transparent online bidding process, securing financing against such invoices at better terms to address the payment challenges they face.

There are two subsidiaries of M1xchange – M1NXT and Mynd Fintech. M1NXT, an International Trade Finance System (ITFS) that operates as a marketplace out of GIFT City, facilitating cross-border financing in foreign currency from banks and factoring companies based in GIFT City and globally.

Mynd Fintech serves as a platform for facilitating channel finance from banks and factoring companies, thereby strengthening its commitment to providing diverse and effective financial solutions.

Jindal Stainless' market presence 

Jindal Stainless had a consolidated annual turnover of Rs 38,562 crore ($4.7 billion) in FY24 and is ramping up its facilities to reach 4.2 million tonnes of annual melt capacity by FY27.

As of March 2024, it had sixteen stainless steel manufacturing and processing facilities in India and abroad, including in Spain and Indonesia, and a worldwide network in twelve countries. 

The company's product range includes stainless steel slabs, blooms, coils, plates, sheets, precision strips, wire rods, rebars, blade steel, and coin blanks.