Motilal Oswal: Steel Bouncing Back Strongly, Stay Positive  
Coils of steel sit in storage on the cold rolling line ahead of milling at a steel packaging factory. (Photographer: Krisztian Bocsi/Bloomberg)  

Motilal Oswal: Steel Bouncing Back Strongly, Stay Positive  

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

India’s steel sector has turned the corner with recovery in domestic demand and improved margins.

This is led by sharp price hikes (supported by higher regional steel prices, particularly for flat steel) and lower raw material cost (despite recent rise).

Indian hot-rolled coil (HRC) steel (or flats) price has risen 15% in the past two months and is 9% above pre-Covid-19 levels (i.e., March 2020).

Reinforcing bar (or longs) price, on the other hand, has risen 11% in two months, but is 4% below pre-Covid-19 levels.

On account of a higher price rise in flat steel versus long steel, gross margin per ton for HRC is currently approximately 18% higher than pre-Covid-19 levels and flattish for rebar.

Click on the attachment to read the full report:

Motllal Oswal Steel Sector Update.pdf

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