Shares of Steel Authority of India Ltd (SAIL) surged 3.38% to ₹112.65 on March 19, following the Directorate General of Trade Remedies (DGTR) recommendation for the imposition of a 12% provisional safeguard duty on Flat Steel Products. The move has positively impacted steel stocks, with JSW Steel Ltd. and Tata Steel Ltd. also witnessing gains in early trade.
SAIL’s Performance & Market Movement
- SAIL stock gained 3.17%, trading at ₹112.35 earlier in the session.
- The BSE Metal Index rose 1.55% to 31,065.09, marking an 11.62% gain in the past month.
- APL Apollo Tubes Ltd. and Tata Steel Ltd. also saw gains of 2.57% and 1.91%, respectively.
- Over the last one year, the BSE Metal Index surged 14.47%, outperforming the SENSEX, which grew by 4.67%.
- In March alone, the Nifty Metal Index has climbed 10%, making it the best-performing sectoral index this month.
F&O Ban & Trading Volumes
SAIL shares remain under the F&O ban, preventing the creation of new positions in the stock. Despite this, around 3.22 lakh shares of SAIL have been traded so far on the BSE, compared to an average daily volume of 10.35 lakh shares in the past month. The stock’s 52-week high stands at ₹175.65 (May 22, 2024), while its 52-week low was ₹99.2 (February 12, 2025).
DGTR’s Safeguard Duty Recommendation
In an overnight notification, the DGTR proposed a 12% safeguard duty on various Flat Steel Products for 200 days, pending further investigation. The industry had initially demanded a 25% duty. Products under the scope of this duty include:
- Hot Rolled Coils, Sheets, and Plates
- HR Plate Mill Plates
- Cold Rolled Coils and Sheets
- Metallic Coated Steel Coils and Sheets (Profiled or Not)
- Colour Coated Coils and Sheets (Profiled or Not)
- Galvanneal Coated Steel (Zinc, Aluminium-Zinc, or Zinc-Aluminium-Magnesium Coated)
The Finance Ministry will now take the final call on imposing the duty. The DGTR emphasized the sharp rise in steel imports as a significant threat to domestic steel producers, warranting immediate action.
Industry & Brokerage Views
According to Kotak Institutional Equities, domestic steel prices already trade at a 7%-8% premium to import parity, limiting further price hikes. The brokerage sees better risk-reward in non-integrated steel producers like JSPL and Jindal Stainless, while maintaining a “sell” rating on SAIL, Tata Steel, and NMDC.
Conclusion
With the DGTR’s safeguard duty proposal and strong sectoral performance, SAIL, JSW Steel, and Tata Steel continue to trade higher. The Nifty Metal Index, which has been the top-performing index in March, reflects growing investor optimism in the sector. However, market participants will closely monitor the Finance Ministry’s final decision on the safeguard duty.