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Movement in shares of major steel companies will be earnings driven next week and is also expected to follow the likely volatile trend in local share market. Trade in local share market may remain volatile in coming sessions as several companies will detail their Oct- Dec earnings and as RBI releases third quarter monetary policy review. Market participants widely expect RBI to cut repo rate by 25 basis points.
Among the key steel companies, JSW Steel will detail its consolidated Oct-Dec earnings on Monday. The company is expected to post a consolidated net profit of 1.44 bln rupees for Oct-Dec, down 79% from Jul-Sep, due to poor availability of iron ore, fall in net sales, and expectation of losses in subsidiary JSW Ispat
Steel. Shutdown of the company's Corex unit at its Vijaynagar plant in October for maintenance, and likely foreign exchange loss may also drag the performance sequentially. Net sales of Mumbai-based JSW Steel are seen at 86.12 bln rupees in Oct- Dec, down 9% on quarter.
Since JSW Steel earnings are scheduled next week, sentiment in the other steel stocks could be largely driven by earnings of this (JSW Steel) company. Shares of key steel companies declined by 0.50-2.00% this week in the absence of fresh triggers amid weak fundamentals.
