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Informist, Friday, May 23, 2025

MUMBAI – Shares of metal companies are likely to move in a small range in the near term due to the absence of major triggers for the sector. The ongoing March quarter earnings season is likely to lead to stock-specific movement, but the sector is not expected to see any major volatility. "There are no major negative cues for the sector, and I think most of the positives are currently priced in," an analyst at a domestic broking firm said. 

Recent data also suggests some fall in steel imports from other countries such as China, which is a positive for Indian steel players in the near term as a fall in steel imports from China was not expected, the analyst said. Media reports said that India's finished steel imports fell over 11% on year in April due to a slowdown in shipment from China and Japan. 

With the earnings season on the run, investors will closely look for steel companies' comments on business outlook, commodity prices, and demand, among other factors. The quarterly results of JSW Steel were released post market hours Friday. Higher output and lower raw material costs helped the company to report a double-digit year-on-year rise in consolidated net profit for the March quarter. This is the first time in five quarters that the company is posting a year-on-year growth in net profit. The steel-maker posted a 16% year-on-year increase in its net profit for the March quarter at INR 15.03 billion. The net profit was, however, sharply lower than the analysts' estimate of INR 17.98 billion. This is the first time in four quarters that the company's bottom line has crossed INR 10 billion. The company's revenue from operations fell 3% on year to INR 448.19 billion, a tad above the Street estimates. Sequentially, the revenue rose 8%. 

Further on earnings, Steel Authority of India is scheduled to release its quarterly results Wednesday. Its net profit for the reporting quarter is expected to fall almost 31% on year to INR 7.01 billion and revenue is likely to decline 3% to INR 271.03 billion, according to the average of estimates from 16 broking firms. However, the company's financial growth figures are expected to be positive, with the bottom line seen rising a whopping 457% and the top line seen increasing nearly 11%. Its earnings before interest, tax, depreciation and amortisation is expected at INR 27.19 billion, according to the average of estimates from 14 brokerages. 

The Nifty Metal rose 0.5% this week ending at 9249.60 points Friday. Hindustan Copper and Adani Enterprises were the top gainers in Friday's session and their stocks closed 5% and 2% higher, respectively. 

TOP HEADLINES

* Odisha CM inaugurates phase-II expansion of Tata Steel's Kalinganagar plant
* Analyst Concall: Nalco plans INR 37 bln capital expenditure over 2 years
* Andhra govt issues letter of intent to Hind Zinc for Tungsten mineral block
* Earnings Review:NALCO beats Street view on PAT as sales jump, costs moderate
* Godawari Power Jan-Mar consol sales fall 4% YoY but net profit rises 1.4%
* Analyst Concall: Hindalco says FY26 capex seen INR 75 bln-INR 80 bln
* Earnings Review: Hindalco posts best-ever earnings in Jan-Mar, beats Street
* Fitch sees limited impact of Bhushan Power order on JSW Steel credit profile
* Shyam Metalics to set up wagon mfg facility at Kharagpur, West Bengal
* Vedanta receives tax orders worth INR 1.45 billion
* JSW Steel board to mull raising funds via QIP, NCDs, others on May 23
* Nava Jan-Mar consol PAT rises 13.7% YoY to INR 2.34 billion

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 Anjana Therese Antony

Edited by Tanima Banerjee

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