23 Dec , 2024 By : Debdeep Gupta
Shares of metal companies, especially steelmakers, rose in early trade on December 23 after the Directorate General of Trade and Remedies (DGTR) took notice of the steel industry's request seeking a 25 percent safeguard duty on imports and began its investigation on the matter.
Even though a decision on the matter is expected following the DGTR's investigation, CNBC-Awaaz reported, citing sources, that a safeguard duty on steel imports could potentially be imposed based on the initial findings of the inquiry, even before the final report is completed. The DGTR probe will assess whether to impose a safeguard duty, a temporary tax, of up to 25 percent to address the excessive import of steel.
Buoyed by this development, shares of steelmakers JSW Steel, Tata Steel, Jindal Steel and Power, Steel Authority of India, and Hindalco, rose 1-2 percent. Gains across major metal manufacturers also lifted the Nifty Metal index over a percent higher in opening trade.
Meanwhile, brokerage firm Investec stated that it is the effectiveness of these measures that need to be watched for. Accordingly, the brokerage pointed to JSW Steel and Tata Steel as the biggest beneficiaries of the implementation of safeguard duty on imported steel.
Steel Minister HD Kumaraswamy had previously stated that the Centre was considering a safeguard duty of 25 percent on steel imports. This move comes in response to concerns over a surge in cheap steel imports, as provisional government data revealed that India’s import of finished steel products from China reached an all-time high in the first eight months of the fiscal year, intensifying worries among domestic mills about the impact of these low-cost shipments.
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