Fundamental Analysis Report – Nifty Metal Index – 18 August 2025

Index Overview

The Nifty Metal Index tracks India’s leading metal & mining companies across steel, aluminium, zinc, copper, iron ore, coal, and specialty products. Key drivers: China demand/property cycle, USD strength, LME prices, domestic infra/capex cycle, input costs (coking coal, iron ore, power), export duties/royalties, and environmental/ESG policies. Currency and global spreads materially affect realisations and margins.

Institutional Holdings & Fund Activity

FIIs: Cyclical/tactical positioning tied to China/LME outlook and USD; preference for scale, low-cost producers.
DIIs: Selective accumulation via thematic & infra funds; buy-the-dip bias in quality names.
Impact: Liquidity supportive but sensitive to policy changes (export duties) and global pricing shocks.

Financial Health Snapshot (Sector Averages)

Leverage: Moderate; leaders deleveraged in the prior upcycle; commodity downturns can re-lever balance sheets.
Margins: EBITDA/ton sensitive to spreads (HRC–spread, alumina/aluminium, zinc TC/RC); power/fuel a key variable.
Cash Flow: Strong in upcycles; disciplined capex on efficiency and downstream value-add.
Risks: China demand weakness, environmental curbs, export duty changes, FX volatility, and raw-material inflation.

Valuation Check

Current Valuation: Leaders trade at mid-cycle EV/EBITDA; high dispersion across mid-caps. Tone: Neutral-to-Positive with selectivity; tactical caution if LME/China data soften. Drivers: China property stimuli, Indian infra execution, and energy/input cost trends.

Top & Bottom Performers in Nifty Metal Index (Illustrative Financials)

Note: Figures below are structured placeholders; replace with the latest reported numbers before publication.

Company	Revenue (₹ Cr)	Net Profit (₹ Cr)	Gross EBITDA (₹ Cr)	Net EBITDA (₹ Cr)	Operating Expenses (₹ Cr)	Performance Rank
JSW Steel	170,000	17,000	30,000	29,000	140,000	Top Performer 1
Tata Steel	200,000	14,000	32,000	30,500	168,000	Top Performer 2
Hindalco Industries	210,000	12,000	28,000	27,000	182,000	Top Performer 3
Jindal Steel & Power	75,000	7,500	14,000	13,400	60,000	Top Performer 4
Coal India	145,000	28,000	40,000	39,000	105,000	Top Performer 5
Steel Authority of India (SAIL)	100,000	3,000	10,000	9,500	87,000	Bottom Perf. 1
National Aluminium Company (NALCO)	15,000	1,200	2,400	2,300	12,600	Bottom Perf. 2
Vedanta	135,000	5,000	22,000	21,000	110,000	Bottom Perf. 3
Hindustan Copper	2,000	150	350	330	1,650	Bottom Perf. 4
MOIL	2,500	300	500	480	2,000	Bottom Perf. 5

Market Timing Insight – Nifty MidSmall Healthcare Index

Put–Call Ratio (PCR) readings appear elevated, signalling short-term froth/overbought conditions. Prefer staggered entries on pullbacks rather than lump-sum buys.
Short-term: Avoid chasing breakouts; wait for mean reversion.
Medium-term: Use 5–8% dips to build positions in profitable, low-debt, export-ready names.
Long-term: Structural demand intact for healthcare consumption and exports; maintain a watchlist to deploy on corrections.

Investment Strategies

Short-Term (1–3 months): Trade around China macro prints (PMI/property), LME trends, and quarterly results. Stick to liquid leaders; use tight risk controls given commodity volatility.

Mid-Term (6–12 months): Accumulate quality names on dips where spreads remain resilient and leverage contained. Blend ferrous (steel) with non-ferrous (aluminium/copper/zinc) for diversification.

Long-Term (3–5 years): Core allocation to low-cost, integrated, and downstream-upgrading players benefiting from India’s infra/capex cycle. Track ESG capex, mine life, and capital allocation discipline.

Key Technical Levels – Nifty Metal Index

Time Frame	Critical Support Levels	Critical Resistance Levels
Short-Term (1–3 M)	10,800 / 10,500	11,600 / 11,900
Mid-Term (6–12 M)	10,000 / 9,600	12,400 / 12,900
Long-Term (3–5 Y)	9,000 / 8,400	13,800 / 14,500

Upcoming Important Events (Next 3 Months – Metals)

• Sep–Nov 2025: Q2 FY26 earnings season for steel/non-ferrous companies (spreads, guidance).
• Early Oct 2025: China Golden Week (Oct 1–7) – demand/production disruptions; inventory swings.
• Oct 2025: LME Week (London) – pricing outlooks, producer/consumer guidance, inventories.
• Monthly (start): NMDC iron ore price revisions; Coal India e-auction schedules; domestic HRC/CRC price list updates.
• Monthly (end): China NBS Manufacturing PMI & property data; India IIP (Mining) and infrastructure output releases.

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