Tag: steel industry

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Market News Top 10 News

Retail Inflation Eases to 5.88% in Nov – Top Indian Market Updates

Consumer Price Index

Here are some of the major updates that could move the markets tomorrow:

India’s retail inflation eases to an 11-month low of 5.88% in Nov

India’s retail inflation (based on the Consumer Price Index or CPI) eased to an 11-month low of 5.88% in November on an annual basis. The figure came within the Reserve Bank of India’s (RBI) tolerance band for inflation of 2-6% for the first time this year. CPI stood at 6.77% in October. The decline can be attributed to a fall in food prices, which account for almost 40% of India’s CPI basket. Food inflation for November came in at 4.67%, compared to 7.01% in Oct. 

Meanwhile, India’s factory output (measured by the Index of Industrial Production or IIP) witnessed a (-)4% contraction in October 2022.

Read more here.

OnePlus partners with Reliance Jio for 5G

Reliance Jio has partnered with global technology brand OnePlus to bring in the evolutionary standalone (SA) 5G technology ecosystem in India. As a part of the collaboration, all the OnePlus 5G devices will be powered by Jio ‘True 5G’ technology. Currently, Reliance Jio is rolling out 5G SA in Delhi-NCR, Mumbai, Kolkata, Varanasi, Chennai, Bengaluru, Hyderabad, and Pune. 

Read more here.

India’s steel output grows 5% to 10.34 MT in Nov: SteelMint

According to SteelMint India, India’s crude steel output rose by about 5% YoY to 10.34 million tonnes (MT) in November 2022. SAIL, Tata Steel, JSW Steel, JSPL, AMNS India, and RINL produced 6.28 MT of steel, and the remaining 4.06 MT came from the secondary sector. The consumption of the alloy surged 13.42% to 9.66 MT in November, compared to 8.52 MT a year ago.

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ONGC to invest ₹2,150 crores on drilling 53 exploratory wells in Andhra Pradesh

Oil & Natural Gas Corporation (ONGC) will invest ₹2,150 crores to drill 53 exploratory wells in Andhra Pradesh. It will carry out the exploration of 50 wells in the Krishna Godavari (KG) basin in East and West Godavari districts. Meanwhile, three drillings will be carried out in the Cuddapah basin in Kurnool, Anantapur, and YSR districts.

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TCS faces lawsuit in the US for alleged discriminatory hiring practices

Tata Consultancy Services (TCS) is facing a class action civil rights lawsuit from a former employee in the US for discriminatory hiring practices. Shawn Katz has filed a lawsuit against TCS seeking relief for alleged discrimination based on race and national origin at the US District Court for the District of New Jersey. He alleged that the IT firm discriminates against non-South Asian and non-Indian applicants and employees.

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Dalmia Bharat to acquire Jaypee Cement for ₹5,666 crore

Dalmia Bharat Ltd’s cement subsidiary will acquire the cement and power plants of Jaiprakash Associates Ltd for ₹5,666 crores. The assets include a cement manufacturing capacity of 9.4 million tonnes (MT), a clinker capacity of 6.7 MT, and thermal power plants of 280 megawatts (MW). The new plants will take Dalmia Cement’s cement manufacturing capacity from 35.9 million tonnes per annum (MTPA) at present to 46.3 MTPA.

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All-India electricity demand may grow 7% to 1,480 BU in FY23: Icra

Electricity demand in India is expected to grow 7% year-on-year (YoY) to 1,480 billion units (BU) in the current financial year (FY23), according to rating agency Icra. In the previous financial year (FY22), the all-India power demand was at 1,380 BU. The estimates are based on the fact that all-India electricity demand increased 10.6% YoY in the first eight months of FY23 amidst a severe heat wave in the north and central India.

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Glenmark Pharma gets warning letter from USFDA for lapses at Goa plant

Glenmark Pharmaceuticals Ltd has received a warning letter from the US Food & Drug Administration (USFDA) for manufacturing lapses (including failure to establish required laboratory control mechanisms) at its Goa-based manufacturing plant. The warning letter summarises significant violations of Current Good Manufacturing Practice (CGMP) regulations for finished pharmaceuticals. USFDA inspected the manufacturing facility from May 12, 2022, to May 20, 2022.

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Macrotech Developers raises ₹3,547 crores via QIP

Macrotech Developers (Lodha) has raised around ₹3,547 crores from foreign and domestic institutional investors through a Qualified Institutional Placement (QIP). This was the largest QIP by any Indian corporate this year. Capital Group, UBS, Abu Dhabi Investment Authority, and Nomura have picked up over 7.2% stake in the real estate company.

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Tata Group plans to open 100 small exclusive Apple stores: Report

According to an Economic Times report, the Tata Group aims to open small exclusive Apple stores across India. Apple is reportedly partnering with Tata-owned Infiniti Retail, which runs the Croma store chain, for the venture. Infiniti Retail will become an Apple franchisee partner. It intends to open 100 such outlets of 500-600 sq. ft. each at malls and high-street locations.

Read more here.

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Market News Top 10 News

Adani Group to Acquire 29.2% Stake in NDTV – Top Indian Market Updates

Here are some of the major updates that could move the markets tomorrow:

Adani Group to acquire 29.2% stake in NDTV

Adani Group’s media arm announced it will indirectly acquire a 29.18% stake in New Delhi Television Ltd (NDTV) and launch an open offer for another 26% stake in the media house. Three firms, Vishvapradhan Commercial Pvt. Ltd., AMG Media Networks, and Adani Enterprises Ltd, will acquire up to 1,67,62,530 fully paid-up equity shares of NDTV (having a face value of Rs 4) at Rs 294 per share from the public shareholders.

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India’s crude oil production falls 3.8% in July

India’s crude oil production fell 3.8% YoY in July on lower output from fields operated by state-owned ONGC and private sector firms. Production of crude oil fell from 2.54 million tonnes (MT) in July 2021 to 2.45 MT in July 2022. ONGC’s total production fell 1.7% YoY to 1.63 MT due to lower output from western offshore. The country’s 22 oil refineries processed 10.52% more crude oil at 21.43 million tonnes as demand for fuel picked up.

Read more here.

Godrej Agrovet signs MoU with 3 states on oil palm cultivation

Godrej Agrovet Ltd has signed Memorandum of Understandings (MoUs) with the governments of Assam, Manipur, and Tripura for the development and promotion of oil palm cultivation under the National Mission on Edible Oils-Oil Palm scheme. The company will be allotted land in the three states for developing sustainable palm oil plantations in the region. In August 2021, the Indian govt launched the National Mission on Edible Oils-Oil Palm scheme with a planned outlay of Rs 11,040 crore.

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NHPC signs pact with BEL to set up solar equipment manufacturing facility

NHPC Ltd has signed a pact with Bharat Electronics Ltd (BEL) to set up a large-capacity solar equipment manufacturing facility. State-owned hydro power giant NHPC has an installation base of 7071.2 megawatts (MW) from 24 power stations. It is engaged in the construction of 11 projects aggregating to a total installed capacity of 7,539 MW.

Read more here.

SpiceJet plans to raise funds worth $251 million: Report

As per a report from ET Now, SpiceJet Ltd is looking to raise funds worth $250.53 million (~Rs 1,998 crore). The low-cost airline is pursuing multiple ways to raise funds, including government lending schemes or equity sales. SpiceJet has been under the scanner lately, following incidents of technical snags that prompted India’s aviation regulator to order a reduction in its approved fleet by 50% for eight weeks.

Read more here.

Ramco Systems partners with Australian freight and distribution service provider

Ramco Systems Ltd will implement its Logistics ERP Software at Freight Specialists to automate company-wide operations and services. The software will include modules for transportation, warehouse, and invoice management. It will offer superior user experience, end-to-end visibility, and control while enabling real-time operational excellence. Freight Specialists is a leading freight and distribution services provider based in Sydney, Australia.

Read more here.

India to become world’s number one producer of steel: Jyotiraditya Scindia

Union Minister Jyotiraditya M Scindia said India will become the number one producer of steel in the world in the days to come. He was of the view that our country has moved from becoming the net importer of steel to the net exporter of steel. Currently, India is the world’s second-largest producer of crude steel after China. The per capita steel consumption has increased from 57.8 kg in 2013-14 to 78 kg. The government intends to achieve 300 million tonnes (MT) of steel production target by 2030.

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GMDC to hire consultants to set up modular lignite washery

Gujarat Mineral Development Corporation (GMDC) has invited requests for proposals (RFPs) for technology consultants for the dry beneficiation technology sulphur removal plant. The company aims to set up a modular lignite washery to remove pyrites/sulphur from lignite produced from the company’s Surkha (North) mines in Bhavnagar, Gujarat. This will help reduce sulphur dioxide emissions and improve boiler efficiency for the end users.

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Tata Motors signs PPA with Tata Power to develop onsite solar project

Tata Motors has signed a Power Purchase Agreement (PPA) with Tata Power to develop a 7.25 megawatt-power (Mwp) onsite solar project at its commercial vehicle manufacturing facility in Jamshedpur. With this project, the onsite solar plant capacity of the facility will reach 14 MWp, which will generate 442 million units of green electricity having the potential to reduce carbon emission by 3.5 lakh tonnes.

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Editorial

What Will be the Impact of Export Duty on Steel?

The Indian steel industry received a “major shock” last month! The Central government introduced a 15% export duty on steel intermediaries and products, effective May 22. For the uninitiated, export duty is a tax payable on goods leaving a country. Moreover, the government also slashed import duty on certain raw materials used in the steel-making process.

In this article, we discuss the impact of this move on steel companies and other stakeholders.

Why is the Govt Levying Export Duty?

  • An export duty of 15% (from nil earlier) has been levied on steel products and intermediaries to improve the availability of steel in the domestic market. It will protect domestic manufacturers of steel. The duty has been imposed on flat-rolled products, bars & rods, and various flat-rolled products of stainless steel. 
  • Meanwhile, the government has waived customs duty on the import of some raw materials used by the steel industry, such as coking coal and ferronickel. This move will lower costs for the domestic steel industry and reduce prices, thus helping curb inflation.

The Impact

After the Central govt issued the notification on May 23, we saw major steel stocks fall heavily! The shares of Tata Steel, Steel Authority of India (SAIL), and JSW Steel hit 52-week lows. The NIFTY Metal Index crashed 16% in May alone, the sharpest decline since March 2020. Steel stocks were already under pressure due to low demand and weak international prices. Moreover, rising inflation, geopolitical tensions (Russia-Ukraine war), and high crude oil prices have impacted the Indian economy.

  • The 15% export duty is likely to reduce margins on steel exports. Foreign clients will turn to manufacturers in their country to maintain costs. 

Export margins were attractive/profitable for Indian steel companies last year due to lower exports from China (due to their de-carbonisation drive) and higher energy prices in Europe. Thus, the recent step to levy export duty on certain steel products will enable sales volumes to shift to domestic markets.

  • The imposition of export duty has accelerated a fall in benchmark steel prices. Higher production/supply volumes and low demand in our country have caused prices to drop. Domestic hot-rolled coil and cold-rolled steel have declined by Rs 5,500 and Rs 6,300 a tonne, respectively, over the past two weeks.

This development comes at a time when the Indian steel industry is approaching a seasonally weak quarter (due to Monsoon). Domestic demand is usually subdued in Q2. Long story short, prominent steel manufacturers will face a tough time handling revenue margins in the coming months. It could also put pressure on the returns from capital expenditure (capex). While most steel stocks are near their 52-week lows, do keep a close eye on them for good investing opportunities!

What are your views on the government’s actions to support the steel/metal industry? Let us know in the comments sections of the marketfeed app.