ArcelorMittal: Steel the Deal

Its JV in India (AMNS India) is on track to become its most profitable operation. With Indian steel demand expected to surge over the coming decades, AMNS is investing to expand capacity significantly. In North America, its Calvert facility is being transformed into the leading domestic auto-grade steel producer. These regions are forecasted to lead global steel demand over the next decade. This rapid expansion, combined with ongoing infrastructure and industrial development, positions ArcelorMittal to become a dominant player in one of the world’s fastest-growing steel markets.

The company has shifted from a volume-focused model to a higher-margin, value-added product mix. This includes advanced steel grades for automotive and strategic upstream integration in iron ore and HBI. Strategic divestitures and capex discipline have enhanced its structural profitability and lowered breakevens

ArcelorMittal has returned $12bn+ to shareholders since 2020 through dividends and buybacks. It has cut share count by 37%, has strong cash flow visibility, and targets 50%+ of post-dividend FCF returned to shareholders. Despite this, the stock trades ~30% below its 2017 enterprise value, with even better margins and growth prospects today.

• India and Calvert capex projects reaching major milestones in H2 2025. AMNS India expansion to 15Mt by end 2026: significant EBITDA step-up.

• Positive restocking cycle in Europe could lift steel volumes

• Bold plan to grow EBITDA by $1.9 billion by 2027 through strategic investments in North America, India, and decarbonisation.

• Key production phases of the AMNS India capacity expansion project are expected to be completed over the next few years. Meeting these targets would reinforce ArcelorMittal's footprint in the fastest-growing steel market globally.

• Consolidation of Calvert JV and NOES plant launch to reshape US auto supply chain.

• Sustained growth in Indian steel consumption, driven by urbanisation, infrastructure development, and rising per capita income, could turn India into ArcelorMittal's largest and most profitable operating base.

• Decarbonisation strategy maturing, with broader adoption of green steel technologies and regulatory tailwinds, could attract ESG-focused investors and support a structural re-rating of the company.

• Strategic projects could deliver $1.9bn+ in structural EBITDA uplift.

Steel remains a cyclical and economically sensitive industry. Global demand is heavily influenced by broader macroeconomic trends, especially in construction and automotive sectors. While ArcelorMittal benefits from a diversified regional mix, a prolonged downturn or geopolitical disruptions in key markets such as Europe, China, or the US could significantly weigh on sales volumes, margins, and overall earnings.

Decarbonising steel is technically complex and capital-intensive. ArcelorMittal's ability to meet its emissions goals depends on regulatory clarity, government subsidies, and the scalability of emerging technologies. If project costs exceed expectations or carbon pricing tightens prematurely, it could pressure margins or divert capital from growth. The risk also includes reputational pressure if ESG targets are missed.

Large-scale capex programs in India and North America are critical to ArcelorMittal’s long-term growth. However, they also carry risks around budgeting, supply chains, and on-time delivery. If milestones are missed, anticipated EBITDA contributions could be delayed or diluted. Moreover, execution missteps could impact ArcelorMittal’s credibility with investors and its ability to reinvest capital efficiently.