JPMorgan has maintained an ‘overweight’ rating on JSW Steel and Tata Steel, noting that Indian steel stocks have surged sharply in the last two trading sessions. The rally has been driven by positive policy signals from China’s National People’s Congress (NPC), Germany’s €500 billion infrastructure fund announcement, and reports of potential safeguard duty imposition by the Indian government.
While JPMorgan is encouraged by these developments, it also highlighted uncertainties regarding:
- China’s steel production cuts, as the specific scale is still unknown.
- Germany’s €500 billion infrastructure investment, which will be spread over 10 years, potentially delaying the full impact.
- India’s safeguard duty investigation, with reports suggesting it could take 6-9 months to conclude.
Despite the recent rally, JPMorgan remains positive on JSW Steel and Tata Steel, expecting structural tailwinds to support their performance.
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