Metal Stocks Outlook for the week – 14 to 18.07.2014
(www.rupeedesk.in)
(www.rupeedesk.in)
Stocks of metal companies are
seen subdued in the week ahead, although the underlying
bias remains positive.
Positionally the view is still positive on most metal companies.
Investors may look at the sector
with a buy-on-dips strategy for three to four months. He
believes that while most metal
companies may trade a bit weak next weak, still looking
positive on a mid term positional
view. We could see Tata Steel and Jindal Steel and
Power move up a bit.
The reforms introduced in the
Budget Thursday were a sentimental boost to the sector,
although there would be marginal
direct impact, negative or positive, on the companies.
The government is clear on its
intention to reserve natural resources which rather than
being exported could be used for
domestic metal companies, which is a sentimentally
positive for most metal
companies, barring some mining companies.
The proposal to rationalize
import duty on all types of coal, meaning a higher import duty
on coking coal would increase
costs by $3 per tn for steel producers. Thermal coal is
imported from Indonesia with no
import duty as it is exempt under a free-tradeagreement.
The move that could impact the
sector the most could be the increase in
mineral royalty rates.
