Steel Stocks Outlook: Seen up next week on hopes of price rise
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B. Karthick
Jul 26, 2008, 3:56:11 AM7/26/08
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Steel Stocks Outlook: Seen up next week on hopes of price rise
Saturday, Jul 26
Shares of steel companies are seen strengthening further next week
on hopes that prices will be raised in August.
The self-imposed moratorium on prices by steel companies ends this
month, and there is widespread expectation that prices will be raised
in August.
Steel makers refrained from making any direct commitment, but have
amply hinted that a price hike in August is imminent.
All these months, we have been swimming against the stream,
referring to the increasing cost burden.
Prices of steelmaking raw materials, such as iron ore and coking
coal have risen sharply on strong demand from Chinese steel mills.
There is a clear justification for companies increasing prices.
Last month, Steel Minister Ram Vilas Paswan had said the
government was not against steel companies raising prices in
proportion to the rise in input costs. "What we plan to check is
profiteering," he had said.
We feel signs of inflation stabilising and retail steel prices
easing a bit may create a favourable environment for a price hike.
The government Friday said retail prices of pig iron, ingots,
rounds, TMT bars, angles, plates and galvanised sheets have softened
by 3-6% over the last fortnight.
Prices of hot-rolled and cold-rolled coils and wire rods have
"shown a slightly downward trend," a government release said.
Besides efforts by steel companies to push products through their
direct channels, some softening in international prices of billets and
ingots has also led to moderation in domestic retail prices.
Week-on-week closing prices of key steel companies' shares, in
rupees, on National Stock Exchange:
Company Closing Level Closing Level % Change
Jul 25 Jun 18
Steel Authority 139.55 123.20
13.3%
Tata Steel 619.85 592.55
4.6%
JSW Steel 777.00 729.45
6.5%
Jindal Steel & Power 1960.00 1746.10 12.3%
Nifty 4320.65
4092.25 5.6%
Sensex 14274.94 13635.40
4.7%
B.Karthick,
Research Analyst.
Saturday, Jul 26
Shares of steel companies are seen strengthening further next week
on hopes that prices will be raised in August.
The self-imposed moratorium on prices by steel companies ends this
month, and there is widespread expectation that prices will be raised
in August.
Steel makers refrained from making any direct commitment, but have
amply hinted that a price hike in August is imminent.
All these months, we have been swimming against the stream,
referring to the increasing cost burden.
Prices of steelmaking raw materials, such as iron ore and coking
coal have risen sharply on strong demand from Chinese steel mills.
There is a clear justification for companies increasing prices.
Last month, Steel Minister Ram Vilas Paswan had said the
government was not against steel companies raising prices in
proportion to the rise in input costs. "What we plan to check is
profiteering," he had said.
We feel signs of inflation stabilising and retail steel prices
easing a bit may create a favourable environment for a price hike.
The government Friday said retail prices of pig iron, ingots,
rounds, TMT bars, angles, plates and galvanised sheets have softened
by 3-6% over the last fortnight.
Prices of hot-rolled and cold-rolled coils and wire rods have
"shown a slightly downward trend," a government release said.
Besides efforts by steel companies to push products through their
direct channels, some softening in international prices of billets and
ingots has also led to moderation in domestic retail prices.
Week-on-week closing prices of key steel companies' shares, in
rupees, on National Stock Exchange:
Company Closing Level Closing Level % Change
Jul 25 Jun 18
Steel Authority 139.55 123.20
13.3%
Tata Steel 619.85 592.55
4.6%
JSW Steel 777.00 729.45
6.5%
Jindal Steel & Power 1960.00 1746.10 12.3%
Nifty 4320.65
4092.25 5.6%
Sensex 14274.94 13635.40
4.7%
B.Karthick,
Research Analyst.
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