Less than a day into his new role as CEO of Jindal Steel Ltd, Gautam Malhotra faced his first big test—calming investor concerns over a revolving door of top executives at the Naveen Jindal-led steelmaker. During the post-earnings call on Wednesday, Malhotra’s composed assurance—“I tend to stick around”—was as much a message to investors as it was to the company’s employees.
Reassuring the Street
The backdrop to Malhotra’s comment was a growing unease among analysts and shareholders about the company’s high leadership churn. Over the past five years, Jindal Steel has seen five top executives, including four chief financial officers (CFOs) and a managing director, depart after short stints.
Malhotra, responding to a question from Sumangal Nevatia of Kotak Securities, emphasized the stability within the company’s broader workforce. “Many employees have been with us for more than two decades,” he said, noting that overall retention rates remain “fairly high.” His comments suggested that while the top ranks may have shifted, the company’s foundation remains steady.
“I think that should give you enough confidence in our journey going forward,” he added, repeating with a hint of humor, “And by the way, I tend to stick around.”
The Revolving Doors of Leadership
The leadership instability, particularly at the CFO level, has weighed heavily on market sentiment. Since 2020, six CFOs have taken charge, with four exiting in under a year. The recent departure of Mayank Gupta—who resigned after just six months—followed similar abrupt exits by Hemant Kumar Khanna, Ramkumar Ramaswamy, and Deepak Sogani.
Analysts warn that such turnover can erode investor trust. Suman Kumar of Phillip Capital India remarked, “People understand that there can’t be smoke without fire.” Meanwhile, corporate governance expert Shriram Subramanian from InGovern urged the company to be more transparent about the reasons behind these resignations to prevent speculation.
Given that CFOs play a crucial role in signing off on financial statements, Subramanian noted that “frequent and inexplicable exits without logical explanation could be a sign of disagreement.”
A New Leader, A New Chapter
Malhotra’s appointment also marks a fresh phase for Jindal Steel, filling a CEO vacancy that lasted over five years. His predecessor, Sudhanshu Saraf, left in April 2020 after 16 months, though he stayed on as a director for 20 months thereafter.
Unlike his predecessors, Malhotra’s background is unconventional for a steel industry leader. A computer engineer from the University of Pune, he is best known for founding FuelBuddy, a doorstep fuel delivery company that expanded to five countries. His management training spans the University of Manchester, Indiana University, and IIM Ahmedabad.
While his entry signals a possible shift toward tech-driven operational efficiency, analysts like Ambit Capital’s Satyadeep Jain remain cautious: “It is too early to say anything about the new CEO. A perspective can only be formed once the street sees execution and results.”
Steel Under Pressure
Malhotra inherits a company navigating both operational challenges and market headwinds. Jindal Steel’s Q2 FY25 results, released a day before his remarks, fell short of analyst expectations. Net profit for the quarter stood at ₹638 crore—a 26% year-on-year decline and a steep 58% fall sequentially. Revenue from operations dropped 5% to ₹11,686 crore, largely due to weak demand during the extended monsoon and planned plant shutdowns.
Despite the dip, the company has made significant strides in capacity expansion. Its Angul plant in Odisha, after commissioning a new blast furnace, doubled hot metal capacity to 8.85 million tonnes per annum (mtpa) and added a new 3 mtpa basic oxygen furnace. The result: Jindal Steel’s total crude steel capacity now stands at 12.6 mtpa, making it India’s fourth-largest steelmaker—behind JSW Steel, Tata Steel, and SAIL.
Looking Ahead: From Volatility to Vision
Analysts believe the company could be nearing a turning point. “They used to be stuck at around 8 million tonnes of steel production annually,” said Suman Kumar, “but with the Angul expansion, by FY27, operationally there should be a turnaround.”
Over the past five years, Jindal Steel has also aggressively pared down debt, laying the groundwork for growth. Malhotra’s challenge now lies in steering this transition—restoring investor confidence, stabilizing the leadership team, and leveraging his entrepreneurial mindset to modernize operations.
Conclusion: A Moment of Reckoning
Gautam Malhotra’s early reassurance may not silence all skepticism, but it signals intent—a willingness to face legacy issues head-on. As a first-time steel executive leading a company under scrutiny, his ability to translate words into stability will define Jindal Steel’s next chapter.
For now, his promise to “stick around” offers a rare sense of steadiness in a firm long defined by flux.
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