India’s Directorate General of Trade Remedies (DGTR) has recommended a final safeguard duty on steel imports for a period of three years. The DGTR has recommended a 12% duty for the first year, 11.5% in the second, and 11% duty in the third year.
The current safeguard duty of 12% was in place until the end of September, and the latest announcement comes as a positive development for these steel stocks, something that the street was also in anticipation of.
This also clears an important overhang of what will happen to the safeguard duty after the current levy ends in September.
While Tata Steel, JSW Steel, SAIL and JSPL, along with other ferrous stocks could count as potential beneficiaries from this, names like NMDC, APL Apollo and other pipe players could be indirect beneficiaries of this as well.
The Nifty Metal index has declined 2% in the last one month, with stocks like Tata Steel and SAIL having declined between 3% and 10% respectively. Shares of JSPL are up 4.5%, while those of JSW Steel and NMDC have remained flat during the same period.
