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Metals, Mining Q3 Earnings Preview - Steel Companies’ Ebitda/Tonne Likely To Soften: ICICI Direct

Metals, Mining Q3 Earnings Preview - Steel Companies’ Ebitda/Tonne Likely To Soften: ICICI Direct

<div class="paragraphs"><p>Flames and smoke rises from red hot coke at a steel factory in India. (Photographer: Dhiraj Singh/Bloomberg)</p></div>
Flames and smoke rises from red hot coke at a steel factory in India. (Photographer: Dhiraj Singh/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Direct Report

On the back of elevated coking coal prices, sequentially, Ebitda/tonne of steel companies is likely to witness a softening trend in Q3 FY22E. During the quarter while blended steel realisation is expected to sequentially increase merely ~Rs 1000/tonne QoQ, on the other hand coking coal costs are expected to witness a sharp uptick of ~$80-100/tonne QoQ.

On the volume front, for Q3 FY22 steel companies’ volumes are likely to be flattish QoQ, on the back of tepid domestic demand sequentially and lower exports. On the non-ferrous front, on a QoQ basis, in U.S. dollar terms, zinc, aluminium and copper prices are up 12%, 4% and 3%, respectively, while on a YoY basis, zinc, aluminium and copper prices are up 28%, 44% and 35%, respectively.

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ICICI Direct Metals Q3FY22 Earnings Preview.pdf

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