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Informist, Friday, Mar. 21, 2025

MUMBAI – Shares of metal manufacturers are seen up next week as the commerce ministry has recommended imposing a 12% safeguard duty on steel imports for 200 days. The proposed safeguard duty on flat steel products is expected to support domestic steel prices in the near term, benefitting major producers such as Steel Authority of India, JSW Steel, Tata Steel, and Jindal Steel & Power, Elara Securities said in a report Wednesday.

"As China announced its stimulus plans focussed on domestic consumption and the Indian government's intervention to include a 12% safeguard duty, we see that the steel prices have now bottomed out and should follow a positive trajectory going forward," a research analyst tracking the metal sector at a domestic broking firm said. The safeguard duty could also prompt steel mills to hike prices by up to INR 1,500-INR 2,000 per tonne, which in turn would be a positive step for steel players such as Tata Steel, the analyst said.

The Chinese government has set a GDP growth target of nearly 5% for 2025 and announced stimulus measures to boost its real estate sector and overall consumption. Further, China is working to restructure its steel industry by imposing production restrictions, ICICI Direct Research said in a report Wednesday.

If implemented, these measures may reduce the inflow of cheap Chinese steel into global markets, providing additional relief to steel manufacturers, ICICI Direct Research said. Factors such as robust demand for domestic steel, potential safeguard duties to curb imports, recovery in prices of steel, declining costs of raw materials, and the earnings prospects for domestic steel companies are robust going forward, the brokerage said.

The Nifty Metal index rose 4.9% this week and closed at 9203.55 points Friday. The index had fallen 1.7% the previous week. Support for the index in the near term is seen at 9050 points and the resistance is pegged at 9350 and 9500 points, an analyst at Axis Securities said. Shares of Steel Authority of India rose 8.9% this week. Shares of JSW Steel and Tata Steel rose 5.7% and 4.2%, respectively, this week. On the other hand, shares of Jindal Stainless fell 1% this week.

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Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:

End

Reported by Akshita Kumar
Edited by Ashish Shirke

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