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BSE Metal index hits 6-year high; Tata Steel, Jindal Steel hit 52-wk highs

Thus far in the current calendar year 2017, the S&P BSE Metal index rallied 42% against 21.5% rise in the Sensex.

SI Reporter  |  Mumbai 

Metals price to rise in 2017: World bank

Shares of companies were in focus with the S&P BSE index hitting six-year high on expectations of strong earnings growth in July-September quarter (Q2FY18). Tata Steel, Jindal Steel & Power (JSPL) and National Aluminium hit their respective fresh 52-week highs, while touched a new high on the BSE in intra-day trade on Friday. At 10:11 AM; the S&P BSE index was up 0.88% at 14,379, as compared to 0.55% rise in the benchmark S&P BSE Sensex. The index hit an intra-day high of 14,414, its highest level since July 28, 2011. Thus far in the current calendar year 2017, the S&P BSE index has rallied 42% against 21.5% rise in the benchmark index. Strong commodity prices coupled with decent volume growth would continue to earnings of companies. “In the space, on a sequential basis, we expect the EBITDA/tonne of steel players to increase while non-ferrous players are also likely to report healthy revenues and profitability. On account of an increase in domestic steel prices and moderation in the prices of coking coal (key raw material), we expect steel players to report healthy EBITDA/tonne sequentially,” ICICI Securities said in a Q2FY18 results preview. Analyst at Edelweiss Securities expects year-on-year (YoY) earnings growth momentum to sustain in Q2FY18 for most players in the & mining. This spurt will be largely on account of price hikes & lower coking coal cost for ferrous players and higher LME prices for non– ferrous companies. Despite Q2 being a seasonally weak quarter, we expect Vedanta, and Hindustan Zinc to gain from operating leverage benefits.

Going ahead, while we expect ferrous players to clock earnings growth on better spreads, volumes of non‐ferrous companies are likely to surge amidst steady LME prices. We expect Coal India to benefit from higher volumes and e‐auction premium, NMDC is likely to benefit from price hike effected in September, the brokerage firm said in a note.

Price on BSE in Rs % chg
Company 30/12/2016 13/09/2017 LTP 1-mth YTD
Jindal Steel 69.1 141.85 161.5 13.9 133.7
Tata Steel 391.1 679.7 705.5 3.8 80.4
Inds. 155.1 248.05 265.0 6.8 70.9
JSW Steel 162.5 263.85 257.4 -2.4 58.4
Vedanta 216.3 326.9 323.0 -1.2 49.3
Natl. Aluminium 65.0 82.25 86.6 5.2 33.3
Hind. Zinc 255.5 306.9 319.0 3.9 24.9
S A I L 49.2 61.85 57.1 -7.7 16.1
NMDC 123.5 133.05 120.5 -9.4 -2.4
Coal India 300.0 256.1 285.2 11.3 -5.0
LTP : Last traded price at 10:18 AM

First Published: Fri, October 13 2017. 10:43 IST