India Materials: Steel: Looking beyond seasonality

Research evidence excerpt

India Materials: Steel: Looking beyond seasonality

Idea

June 10, 2026 01:36 PM GMT

Morgan Stanley India Company Private Limited+MIndia Materials | Asia Pacific Rahul Gupta

Equity Analyst

Steel: Looking beyond Rahul.Gupta1@morganstanley.comRuchika A Dhanuka +91 22 6118-2233

Research Associate

Ruchika.Dhanuka@morganstanley.com +91 22 6118-2112

seasonality

Localization of the Indian steel industry and the medium-term

anti-involution theme in China provide structural support for

steel spreads beyond seasonality. Steel stocks have performed

well, and we expect select names to continue to outperform,

supported by strong earnings growth potential.

Steel stocks have performed well: Higher steel prices and limited impact from the India Materials

Middle East conflict have kept earnings cuts risk low, in our view, supporting Asia Pacific

Industry View In-Line

continued outperformance this year following a strong 2025. Steel stocks in our

coverage rose ~12% YTD (market cap-weighted), while the Sensex declined ~13% Exhibit 1 : India – Steel: What's changed

(vs. +27% for steel and ~9% for the Sensex in 2025).

Company Name Tickers UnchangedRating PriceCurrent(Rs) Price Target (Rs) (Downside)Upside/ EBITDA Change (%)

OLD NEW F2027e F2028e

Jindal Steel JINT.NS OW 1149 1250 1340 17% 5% -1%We believe this strong performance cycle is not yet over and expect steel stocks to Steel JSW Steel JSTL.NS OW 1259 1330 1470 17% -11% -11%

Tata Steel TISC.NS OW 203 215 235 16% -4% 3%

remain well supported over the medium term: SAIL SAIL.NS UW 186 140 160 -14% 10% 6%

Source: Morgan Stanley Research (e) estimates. Prices as of June 9, 2026.

• Barring seasonality, spreads are supported: Domestic HRC prices have

risen ~26% from mid-December lows, supported by the extension of

safeguard duties.