MG Motor Is Finally Indian As JSW-Led Entities Pick Up Majority Stake
In JSW Group, MG Motor found an ideal local partner to continue the growth story of the MG brand in India, CEO Emeritus Rajeev Chaba says.
The JSW Group’s foray into India’s EV space has lifted the Chinese hangover on MG Motor India Pvt. Ltd., something that limited the British marquee’s growth in the world’s third largest automotive market.
A clutch of Indian investors, led by billionaire Sajjan Jindal’s conglomerate, have picked up a 51% stake in MG Motor India to create a joint venture called JSW MG Motor India Pvt. Ltd. China’s SAIC Motor Corp. Ltd., which so far owned 100% of the Hector maker, will now hold 49%.
The valuation of the JV was not disclosed. There are no plans to list the entity either.
“In JSW Group, we have found an ideal local partner to continue the growth story of the MG brand in India,” Rajeev Chaba, chief executive officer at MG Motor India, said at an event in Mumbai on Wednesday.
“We are firmly committed to expanding our manufacturing footprint with extensive localisation by leveraging JSW Group’s extensive knowledge and expertise in manufacturing at scale.”
The joint venture can be seen as a shot in the arm—a validation even—for MG Motor in India, for less than two years ago, the carmaker was facing government scrutiny over its Chinese parentage.
The central government had in November 2022 conducted an inquiry into MG Motor India Pvt. Ltd. over alleged financial irregularities, deepening a scrutiny of Chinese firms that were operating in India, Bloomberg reported on Nov. 1, 2022. The scrutiny started after a detailed analysis of the firm’s financial statements indicated suspicious related-party transactions, alleged tax evasion, under and over-invoicing of bills and other irregularities.
MG Motor had then said it was fully cooperating with the investigation.
A year later, in December 2023, JSW Group and SAIC Motor formed a new joint venture to promote green mobility in India. Today’s event simply solidified that partnership.
In January 2024, Competition Commission of India approved JSW Ventures Singapore Pte Ltd.’s acquisition of a 38% stake in MG Motor India Pvt. Ltd.
In February 2024, JSW Group signed an agreement with the Government of Odisha to set up an integrated EV complex at two locations in Odisha. The project, with an investment of Rs 40,000 crore, will help create more than 11,000 local jobs.
(From left) MG Motor India CEO Rajeev Chaba, JSW Group Chairman Sajjan Jindal and his son Parth Jindal. (Photo: Mugdha Mishra/NDTV)
Group Synergies
To be sure, JSW’s foray into India’s automotive sector is a group-level endeavour, but that doesn’t stop the joint venture from making the most of the synergies emanating from the ports-to-energy enterprise.
The conglomerate will invest about Rs 5,000 crore in JSW MG Motor India at the outset to increase production to 300,000 units from 100,000 units at present.
All MG Motor cars in India will be built using steel produced by JSW Steel Ltd. only. The group’s ports and energy verticals will step in to facilitate exports as well as contribute to the battery and charging needs of MG cars.
The JV also aims to bring in advanced EV technologies into India, even as it enhances local sourcing to establish a strong supply chain.
“We will be working tirelessly to bring the best available technology into India, so that we can give the Indian consumer what they want—world-class cars at affordable prices,” Parth Jindal, scion of the JSW Group and member of the steering committee of JSW MG Motor India, said in a post-event media roundtable.
“MG India 1.0 has had a very good five years, and it is now up to the joint venture to make MG 2.0 more impactful and successful. We can’t wait to get going.”
