Macro factors still negative for metal sector: Nirmal Bang

Giriraj Daga, metal analyst, Nirmal Bang, says that it was expected that the outcome would be positive on the event. It is clear that one uncertainty is out of the window.

Below is the edited transcript of his interview to CNBC-TV18. Q: What is your initial view on the news of conditional resumption on iron ore mining that came from SC?
A: It was expected that the outcome would be positive on the event. The Supreme Court has in the last 12-18 months has always gone ahead and gave the iron ore to the industry though first from the inventory, second from allowing NMDC and now they have allowed the permission for 'A' category mines.
Clearly, one uncertainty is out, it is not significantly positive. It will take around one month to come to the whole situation and that way also they will also get at a similar price. I am not seeing significant benefits of iron ore sourcing as well as the price, what they are getting. It is more of a status quo situation in terms of operation. Q: In terms of the stock movement how much will this really aid a couple of these companies like JSW Steel and where do you see their stock prices move from here?
A: There is an uptake of 3-4% from the downside for JSW Steel which is fair given the condition now. As there is no significant change in the operations, so one can expect more uptake of 2-3% in the given situation. Macro factor like global economic market and domestic situation remains on a negative side. So, on these conditions we are negative on the stock as well.