Higher sponge iron prices to bolster Tata Sponge's earnings

A sharp escalation in sponge iron prices, fuelled by an uptick in the construction sector demand, would help Tata Sponge Iron post robust earnings after recovering from a marginal profit of Rs 7 lakh that the company recorded in the December quarter.

With demand for construction sector expected to remain buoyant till May, sponge iron prices are unlikely to weaken anytime soon. Sponge iron prices have appreciated by Rs 3,800 per tonne since February this year, touching Rs 18,000 a tonne in April and gaining significantly from the lows witnessed in the middle of 2016.

Riding on the sponge iron