Stocks of steel companies are likely to trade in a narrow range next week tailing the key indices and market will also eye Tata Steel Ltd's Apr-Jun earnings due for release on Monday. Key indices may see a rangebound trade next week due to lack of triggers. Nifty is seen trading in range of 5250-5380.
The steel maker's consolidated net sales for the reporting quarter are seen down 1% on year at 326.57 bln rupees due to flat sales volumes and lower realisation from its European operations. On a sequential basis, the company's consolidated net profit is seen rising 49% due to improved realisation in India as well as in Europe. Overseas operations mainly in Europe are likely to show some improvement on QoQ (quarter-on-quarter) basis due to slightly higher realisations and lower coking coal cost. Moody's Investors Service, this week revised the outlook on Tata Steel's Ba3 credit rating to negative from stable and also cut the rating of its European arm Tata Steel UK Holdings Ltd to B3 from B2. Last week, Steel Authority of India Ltd disappointed the street with its lacklustre earnings.
In a post-earnings report, while SAIL has disappointed time and again with delays in expansion plans, the company now seems progressing well on the expansion projects. The stock has underperformed primarily on account of various delays, and we believe commissioning of these projects would be a key milestone awaited by investors.
(www.rupeedesk.in)
