Steel stocks cheer MIP move, rally up to 13%

NEW DELHI: Steel stocks rallied up to 13 per cent on Monday morning after the government set a minimum import price (MIP) of $341 to $752 per tonne for 173 steel products in a bid to protect domestic steel industry from cheaper foreign imports.

Foreign brokerage JPMorgan believes the move is positive for steel stocks such as Tata Steel, SAIL and JSW Steel, as domestic steel prices may eventually climb by 5-10 per cent across products.
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In a note, the brokerage said, "MIP is a more comprehensive step to allow some breathing space to the Indian steel industry. The MIP covers an entire range of steel products covering 173 products," it said, adding that Street estimates have not been building in higher prices.

At 9.30 am, the BSE metal index was trading 1.04 per cent higher at 6,970.
Bhushan Steel, which hit a 52-week low of Rs 35.45 last week, surged 12.77 per cent to hit a high of Rs 41.05.

Jindal Stainless soared 8.62 per cent to Rs 23.30.

Uttam Galva Steels climbed 5.67 per cent to Rs 30.75. JSW Steel, SAIL and Tata Steel advanced 2.05 per cent, 1.22 per cent and 1.18 per cent, respectively. Jindal Steel fell 1 per cent to Rs 62.80.

JPMorgan remained overweight on Tata Steel and JSW Steel. It said the government move may turn SAIL profitable.