JSW plans to buy a 35% stake in MG Motor India at ₹35.8 billion investment
The Chinese automaker, SAIC Motor has announced its plans to bring in local investors in India to enhance its operating environment in the country, which is the world's third-largest auto market. As part of this initiative, JSW Ventures, a division of the JSW conglomerate, intends to acquire a 35 per cent stake in MG Motor India for ₹3580 crore ($430 million).
Additionally, IndoEdge India Fund will purchase an 8 per cent stake, a dealer trust will acquire a 3 per cent stake, and an employee stock ownership plan will hold a 5 per cent stake.
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The move comes as New Delhi has sought to restrict investments from Chinese companies amid geopolitical and trade tensions. SAIC aims to bolster MG Motor India's market share in the country and mitigate operational risks by introducing local Indian investors, thereby creating a more conducive environment for sustainable and healthy development.
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SAIC has been focusing on global markets for growth, particularly with its MG brand, which continues the legacy of the iconic British marque. This strategy is crucial as SAIC and its international partners have faced stiff competition in the Chinese market from BYD and Tesla. In 2023, nearly a quarter of SAIC's total car sales were from exports.
MG’s story in India
Earlier this year, MG, a brand under SAIC, revealed its expansion plans for India. The newly formed joint venture, JSW MG Motor India, between Indian conglomerate JSW Group and SAIC, announced their aggressive plans for electric vehicles (EVs). Dubbed as MG Motor India 2.0, this phase will emphasise on new energy vehicles (NEVs) in addition to internal combustion engine (ICE) vehicles. To support this initiative, the JV disclosed an investment of ₹5,000 crore to ramp up production capacity and introduce a new car every 3-6 months beginning September.
The partnership aims to produce vehicles in India not just for the domestic market but also for export to highly developed markets. Drawing parallels with Maruti's transformative impact on the Indian auto industry, Jindal expressed confidence that JSW MG Motor India can achieve similar success.
Moreover, JSW MG Motor India intends to enhance its research, development, and technical capabilities by establishing a dedicated R&D centre. This facility will cater to the diverse preferences of car buyers, focusing on creating connected, contemporary, and locally relevant mobility solutions.
