Heard on the Street- Bhushan Steel faces punters’ wrath

Bhushan Steel shares have been beaten out of shape by the marauding bears, with this stock touching a 52-week low of Rs 411.6 during intra-day trading on Wednesday.

The stock ended the day at Rs 415.30, down 7.8% over the previous close, despite the overall uptrend in the market. Punters on the street point out that two large domestic broking houses have turned extremely pessimistic on this mid-cap steel company and have advised their high net worth clients to exit this stock, even at these depressed levels. That���s because Bhushan Steel derives a significant portion of its topline from supplies of auto-grade steel products, and given the depressed state of the domestic auto industry, punters point out that this stock is ���out of flavour���.

Given the depressed demand conditions for the broader metal sector, they feel large-cap steel stocks provide greater ���margin for safety��� compared to mid-cap players.

Contributed by Amriteshwar Mathur & Ashish Rukhaiyar