View On Metals After Jefferies Call Curtain On Bull Run In Steel Stocks | D&V Safe Ace Strategies

Updated: Apr 3

After a decent upside in the metal space, analysts at Jefferies have lowered their optimism on India's metal sector. “We lower our optimism on India metals as we enter 2022. Weak macro and demand concerns in China are weighing on metal prices,” a report by Jefferies said. The brokerage firm also stated that easing policy could lead to rise in demand in China but risk-reward is lower compared to what it was a year ago. “We find risk-reward for India steel far inferior to a year ago. We believe Indian steel margins have peaked in 1HFY22 and will fall sharply by FY23, albeit settle above historical levels,” Jefferies India said in a note.

The metal index was hit hard as Jefferies report rattled steel investors post it's downgrade rating on steel majors namely Tata Steel and JSW Steel. Post this, how should one look at stocks from the metal space from current levels?

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