Early days of optimism for steel firms as prices move up in China

Stock valuations could improve dramatically if demand rebounds and the China policy support comes through

Rising steel prices in China and rising global iron ore prices might mean a rebound for the fortunes of the Indian iron and steel sector. There are expectations that the Chinese government may roll out a stimulus policy which would lead to stronger demand for industrial metals. Domestic demand is also expected to be strong in FY24 due to the infrastructure and construction thrust in the Budget and signs of recovery in automobiles and real estate/ housing. However, there are mixed signals, with domestic HRC (hot-rolled coil) prices declining upon competition from cheap imports.

Optimism about China has led to