From Tata Steel to JSW Steel: Here's what analysts make of metal sectors stocks

Metal Stocks, Tata Steel share price, JSW Steel share price, JSPL share price target, SAIL share price: Global brokerage firms have revised their stance and targets on several metal sector stocks, including Tata Steel, JSW Steel, and Steel Authority of India Ltd (SAIL). Analysts from Morgan Stanley and Nomura indicated a shift in sentiment towards major metal and steel manufacturer companies in the domestic market, fueled by China's latest stimulus measures and improving domestic conditions.

However, domestic inventory digestion has remained muted, analysts expect that China's economic stimulus will bolster positive sentiment and support steel prices in the near term, said Morgan Stanley.

"With a decrease in import risks, this is anticipated to strengthen spreads across the sector, positioning steel stocks for a robust performance in the coming months," the brokerage said.

The brokerage's report highlighted expectations for domestic hot-rolled coil (HRC) prices to remain range-bound through the second half of FY25, with a marginal recovery projected for FY26.

"Domestic steel prices are now aligning with import parity prices, a significant change from last year's premiums of 8-9 per cent. This realignment suggests a healthier competitive environment, further enhanced by China's de-risking of industry concerns," Morgan Stanley noted.

Morgan Stanley on Metal Sector Stocks

Morgan Stanley has upgraded its ratings on major steel producers companies' stock; check out targets:

• Tata Steel share price target (CMP: Rs 167): Morgan Stanley has an 'equal-weight' rating on the Tata Steel stock with a target price of Rs 175.
• JSW Steel share price target (CMP: Rs 1,027): Analysts have an 'overweight' rating on JSW Steel shares with a target of Rs 1,150.
• JSPL share price target (CMP: Rs 1,035): The brokerage has an 'overweight' rating on the Jindal Steel and Power Ltd (JSPL) stock with a new target of Rs 1,200.
• SAIL share price target (CMP: Rs 141): For the Steel Authority of India (SAIL) stock, analysts have maintained an 'underweight' rating with a revised target of Rs 125.

Meanwhile, another brokerage, Nomura also issued a report on Indian steel producers, emphasising their favourable positioning in the current market landscape. The brokerage identifies some key factors that contribute to this positive outlook, including improved return on equity (ROE), reduced leverage, and robust domestic demand.

Nomura on Metal Sector Stocks

• JSW share price target: Nomura has initiated a 'buy' call on JSW Steel shares with a target of Rs 1,220.
• JSPL share price target: The brokerage also initiated a 'buy' stance on JSPL shares with a target of Rs 1,200.