Steel Sector Check - Volumes Stay Strong, More Price Hikes Likely: Motilal Oswal
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Motilal Oswal Report
Operational data reported by Indian Steel companies indicate that volumes remained strong in Q4 FY21, growing 15% YoY/1% QoQ.
We believe that mix has risen in favour of exports due to strong realization. Exports rose 126% month-on-month in March 2021 to 1.3 million tonne (highest in the last eight months).
Indian mills have raised flat steel prices by Rs 3,500-4,000/tonne in April 2021, which has been absorbed by the market.
We believe further hikes are in store in the next few weeks as the Indian hot-rolled coil prices still trade at a discount of ~Rs 5000/tonne to import parity prices.
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