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Domestic Steel Industry: Ministry in favour of rise in basic custom duty

ICICIdirect Research 04 Oct 2024 DISCLAIMER

As per media sources, the steel ministry is seeking a 100% increase in basic custom duty on the import of steel from China.

It is proposing raising it to 15% from existing 7.5% rate.
 
This is largely in response to substantial rise in steel imports which for Apr-Aug period stood at 3.5 million tonnes, a growth of ~35% YoY

This marks the first instance of the government recognizing the rise in finished steel imports from China.
The surge in imports has pressured domestic steel prices, which currently stand at a three year low of ~₹ 48,200/tonne.

Thus, any increase in import duties, particularly on Chinese steel, would benefit the domestic steel industry. This coupled with stimulus measures announced in China bode well for the domestic metal space.

Within this space, JSW Steel stands out as our top pick due to its ambitious expansion target of 50 MTPA by 2031, a strong product lineup, and healthy profitability outlook

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