Shares of top Indian steel and metal companies saw a rise on Monday, as analysts at Jefferies predicted a positive impact from a possible safeguard duty on Chinese steel imports. Major players like Hindalco Industries, Tata Steel, and JSW Steel gained between 0.7% and 1.7%, driven by expectations that such a duty would help boost domestic steel prices and profit margins.
Also Read: JSW Steel’s Crude Steel Production Surges 12% YoY in February 2025: A Tale of Growth and Challenges
Jefferies Predicts Stronger Margins for Indian Steelmakers
According to Jefferies, if the Indian government imposes a safeguard duty on Chinese steel, it will likely raise steel prices in India. This could improve earnings for companies like Tata Steel, Hindalco, and JSW Steel. Since December 2024, Indian steel prices have already increased by 5%, indicating strong demand and a favorable market.
The report noted, “With safeguard duty in place, domestic steel prices are expected to remain strong, giving Indian manufacturers a competitive advantage by reducing pressure from cheaper Chinese imports.”
Jefferies Increases Target Prices for Tata Steel & JSW Steel
Given the positive outlook, Jefferies raised the target price for JSW Steel to ₹920 (from ₹850) and Tata Steel to ₹180 (from ₹165). The firm maintained a “buy” rating for Hindalco, as its stock has gained 16% year-to-date. Tata Steel also kept its “buy” rating, while JSW Steel was given a “hold” rating, indicating limited upside potential.
Stock Performance in 2025
Indian steel stocks have been performing well in 2025, supported by strong demand and rising steel prices:
- Hindalco (HALC.NS): Up 16% YTD
- Tata Steel (TISC.NS): Up 11% YTD
- JSW Steel (JSTL.NS): Up 14% YTD
Government’s Trade Policy in Focus
The Indian government has been considering trade policies to reduce reliance on cheap steel imports from China. If a safeguard duty is introduced, imported Chinese steel will become more expensive, making Indian-made steel more competitive. This could help Indian steelmakers boost their profit margins and strengthen their market position.
Read More:Â India’s Metal Stocks Soar: The China Connection Ignites a Rally
Future Outlook for the Indian Steel Industry
With rising steel prices and the possibility of safeguard duties, Indian steel companies are expected to continue their strong performance in 2025. However, factors like raw material costs, demand from industries, and global trade developments will also influence the sector’s growth.
Investors are now keeping a close eye on any government announcements regarding trade measures, as these could significantly impact steel stock prices in the coming weeks. For now, the market remains optimistic about the industry’s future.
