Metals may continue to shine; recent correction in steel stocks offer good buying opportunity: Centrum Broking
Metal stocks have been among the top performers of late thanks to improvement in demand, the shift of business from China to India and low base due to the March 2020 sell-off.
Base metals outperformed and reached a multi-year high in FY21 on a weak dollar and strong manufacturing and economic data from China and the US after vaccine news surfaced, Sunilkumar Katke, Head, Commodity & Currency, Axis Securities, told Moneycontrol.
“The demand is outpacing supply this year as overall output is also low compared to previous years due to mining lockdowns. The US spending on infrastructure and electric vehicle (EV) revolution to support overall base metal prices in FY22, especially copper and nickel prices,” he said.
The Nifty Metal index is up 63 percent year-to-date (YTD) with stocks like Adani Enterprises surging as much as 239 percent.
Shares of JSW Steel, Tata Steel, National Aluminium, Vedanta, SAIL, Hindalco and NMDC have jumped between 59-85 percent.
Source: Money Control