new Delhi. On one hand, India’s main indices Nifty 50 (Nifty 50) and Sensex (BSE Sensex) have declined tremendously, on the contrary, Nifty Metal Index has jumped by about 12% in the last 5 sessions of trading. Market experts are acknowledging the sanctions imposed on Russia as the reason behind this boom in the metal sector. Due to this restrictions, a boom is being seen in Aluminum, Nickel, Steel, Thermal Coal, and PCI Coal.
India is a net exporter of aluminum. This is the reason why the country’s largest brokerage firm Motilal Oswal believes that companies like Hindalco, National Aluminum Company (Nalco) and Vedanta will benefit from higher aluminum prices. Whereas, Coal India will be the biggest beneficiary of the jump in demand for coal, and Tata Steel will be the biggest beneficiary of the rise in steel prices in the European Union.
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Top Pick of Motilal Oswal
A note from the brokerage house said, “Our top stock picks are Hindalco, Nalco and Coal India, which are expected to benefit from rising commodity prices. are supposed to. We expect steel prices in Europe to pick up and continue to be expensive. Tata is likely to get the most benefit from it. Our biggest risk to these calls is that there could be a reduction in consumption at higher prices, which could result in a fall in commodity prices.”
how long expected
Motilal Oswal believes that the sanctions on Russia will cause problems in the supply chain of many goods and it may take several months to restore the entire supply chain. Till this happens, the prices are likely to remain high.
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Direct Benefit to Hindalco and Nalco
Brokerage firm Motilal Oswal said, “Hindalco will benefit immensely from the ban on Russian aluminum as it has strong exposure to both upstream and downstream segments. Nalco is a direct beneficiary of the increase in aluminum and alumina prices due to Russia’s approval.”
According to Motilal Oswal, Vedanta will benefit from many other commodities including oil, aluminum, zinc and steel. While the company is likely to benefit from the rise in commodity prices, on the other hand, the company will face difficulties due to higher raw material prices, especially coal prices.
Tags: Nifty, Russia, Russia ukraine war, Tata steel
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