Steel Authority of India (SAIL), JSW Steel, and Tata Steel were down in the range of 3 per cent to 4 per cent, against 2.2 per cent fall in the Nifty Metal index.
Despite getting exemption under the ESMA (Essential Services Maintenance Act), analysts expect all major steel plants to reduce operations significantly over the next 7-10 days. The rising cases of coronavirus across the globe would remain a key variable to monitor as it may impact the demand for globally traded commodities.
“If the government, after conducting significantly higher number of Covid-19 tests, comes to the conclusion that the severity of the outbreak is much more than what the current numbers indicate, we believe the nationwide lockdown might extend further, and as a result Q1 could be a washout for most of the companies,” analysts at Emkay Global Financial Services said in metal & mining sector update.
Last month, Moody's Investors Service had changed the outlook on JSW Steel’s ratings to stable from positive.
"The change in outlook to stable reflects JSW's weaker than expected operating performance, and our expectation that it will take longer for the company's credit metrics to improve to levels that warrant a higher rating," said Kaustubh Chaubal, a Moody's Vice President and Senior Credit Officer.
JSW Steel's stock hit an intra-day low of Rs 140 on the NSE. It was trading close to its 52-week low level of Rs 136 touched on March 23. It has slipped 41 per cent in the past month.