Home / News / India /  Metal index rises in a weak market. Which metal stocks should you buy, sell or hold?
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Metal stocks were the top gainers today with Nifty metal index surging over 1% in Friday's early deals as compared to about 0.5% fall in benchmarks Sensex and Nifty. Among individual metal stocks, SAIL, Jindal Steel, JSW Steel, and Tata Steel shares were trading with gains of over 3% each.

Domestic brokerage and research firm ICICI Securities has maintained Reduce rating on metal stocks Tata Steel (TP: 827), SAIL (TP: 61), JSW Steel (TP: 448), NMDC (TP: 98), JSPL (TP: 290). APL Apollo remains its top stock pick in the metal sector and has maintained Buy tag whereas has maintained Hold on Jindal Stainless and Shyam Metalics shares.

APL Apollo is one of the major beneficiaries of steel export duty. Sharp decline in steel prices is expected to dent EBITDA print in Q1FY23, through inventory losses and volume impact due to industry destocking,  What will impact Q2/Q3FY23 for APL is the continuous downtrend of HRC prices leading to periodic destocking impulses. This leads us to reduce our FY23/24E volume estimates for APL Apollo. We maintain BUY on the stock with a revised target price of 1,042/share," the note stated.

It has maintained reduce on Hindalco, while downgrading Nalco to sell from Reduce. As per ICICI Securities, Hindalco is feeling the possible pinch of aluminium returning into surplus (from deficit) over FY23/24E, along with the traded instrument facing the headwinds of a rising interest rate environment and possible compression in Novelis margins. 

“In China, fresh lockdowns have thwarted hopes of any recovery. Regional prices continue to slip with FOB prices in the range of USD700-750/t. The situation is further exacerbated by macro risks. We maintain our cautious stance on ferrous sector with Shyam Metalics (TP: 353 as the sole ‘BUY’ in the space," said another brokerage Edelweiss.

Meanwhile, Edelweiss has a ‘HOLD’ rating on Tata Steel with target price of 985 and JSPL (TP: 385) and ‘REDUCE’ on JSW Steel (TP: 471) and SAIL (TP: 57).

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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