Nomura has maintained its 'Buy' rating on Jindal Steel but trimmed the target price to ₹1,300 from ₹1,350 following the steelmaker's stronger-than-expected June quarter earnings. According to Nomura, Jindal Steel reported consolidated EBITDA of ₹26.6 billion, beating the brokerage's forecast and Bloomberg consensus estimate by 13% and 7% respectively. The earnings beat was attributed to stronger-than-expected volume growth and resilient realisations despite weakness in rebar prices. Consolidated volumes rose 17% year-on-year to 2.23 million tonnes, exceeding Nomura's estimate by 4%, while realisations increased 12% quarter-on-quarter against the brokerage's expectation of a 5% rise.
Nomura has maintained its positive outlook on the Indian steel sector, retaining 'Buy' ratings on Tata Steel, JSW Steel, Jindal Steel and Lloyds Metals & Energy. According to reports from Nomura, the brokerage believes domestic steelmakers remain well positioned to benefit from recent price hikes despite global uncertainties and higher input costs. The firm noted that domestic flat steel prices remained resilient during the week ended July 24, while rebar prices registered their first weekly gain after a prolonged correction.
According to Nomura, domestic hot rolled coil (HRC) prices declined by ₹50 per tonne week-on-week to ₹57,800 per tonne, while rebar prices rebounded by ₹350 per tonne to ₹48,300 per tonne, marking the first improvement after a prolonged three-month correction. The brokerage highlighted that the domestic flat-long spread remains positive at over ₹9,500/t, supported by sustained resilience in HRC prices over rebar prices. India's HRC spot margin in July 2026 stands at ₹34,609/t, improving marginally by ₹324/t month-on-month.
Globally, steel prices remained mixed with China's export HRC prices easing by USD5 per tonne week-on-week to USD495 per tonne, while domestic HRC prices fell by USD4 per tonne to USD485 per tonne. In Europe, HRC prices increased by EUR10 per tonne week-on-week to EUR695 per tonne, with EU steel margins improving to around EUR446 per tonne. According to Nomura, imported coking coal prices declined by USD6 per tonne week-on-week to USD224 per tonne, while global iron ore prices remained stable at around USD93 per tonne.
Looking ahead, Nomura said the domestic steel industry is well positioned to benefit in 1HFY27F from the price hikes implemented in late 4QFY26 and through 1QFY27, adding that these increases are more than sufficient to absorb any cost inflation arising from the West Asia crisis. Following revisions to its steel price and raw material assumptions, Nomura lowered its FY27 volume estimate by 5% to 10.5 million tonnes and reduced its FY27, FY28 and FY29 EBITDA forecasts by 5%, 8% and 11% respectively. Despite the estimate cuts, the brokerage retained its positive stance, saying it believes Jindal Steel is entering a multi-year asset optimization phase with recently commissioned capacities driving incremental earnings at limited capital intensity.
