Ferrous metals headed for subdued start in FY21 due to dip in auto demand

After recovering in Q4 of FY20, the ferrous metals segment is headed for a subdued start in FY21.

Analysts believe that strict quarantine measures to enforce lockdown will lead to demand erosion even though the supply side is facing relatively lower disruptions.

“Demand for finished steel products has slowed down even before the onset of coronavirus pandemic due to flagging auto demand and shrinking government capex spends. In this stage of unforeseen crisis, steel companies with long products portfolio and limited overseas exposure will perform better,” said a metals analyst.

There are apprehensions that if the nationwide lockdown to contain