JPMorgan has stated that the long-awaited safeguard duty of 12% for 200 days has finally been announced, which is a positive development for the Indian steel sector. The brokerage expects this measure to increase the landed cost of imports by ₹5,500 per ton, though the effective rise in domestic hot-rolled coil (HRC) prices may be lower at ₹2,000 per ton.
JPMorgan anticipates that this increase will completely flow through to EBITDA, opening room for earnings upgrades for FY26. Additionally, steel stocks have been rallying in recent sessions on optimism surrounding China’s steel output cuts, Germany’s infrastructure fund announcement, and the safeguard duty imposition.
The brokerage expects stock prices to react positively, as this move signals strong government intent to support the steel sector. Among preferred picks, Tata Steel and JSW Steel remain top choices, while SAIL is also expected to see a sharp positive reaction following its recent underperformance.
(Disclaimer: This article is for informational purposes only and does not constitute financial advice.)
