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Metals & Mining
The Union Budget 2011-12 is likely to be mixed for the metals and mining sector. While an increase in import duty
on ferro alloys will benefit ferro alloy producers, a hike in export duty on iron ore will benefit steel companies
purchasing iron ore from the open market. However, such a move will adversely affect mining companies like Sesa
Goa and NMDC.
Further, imposition of mining tax of 26% on PBT level would be negative for mining companies as well as for steel
companies having captive mines.
We expect excise duty and customs duties on metal products to remain at current levels of 10% and 5%,
respectively.
We believe fund-raising plans by the government through disinvestment will continue in FY2012. We believe the
FY2012 budget is likely to expedite the disinvestment process for SAIL and Hindustan Copper.
Overall, we expect the FY2012 Budget to have a Neutral impact on metal companies, while having a negative
bearing on mining companies.
Top Picks
Sterlite Industries
Hindustan Zinc
tata Steel
Sail
JSW Steel
Electrosteel Cast.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Metals & Mining
The Union Budget 2011-12 is likely to be mixed for the metals and mining sector. While an increase in import duty
on ferro alloys will benefit ferro alloy producers, a hike in export duty on iron ore will benefit steel companies
purchasing iron ore from the open market. However, such a move will adversely affect mining companies like Sesa
Goa and NMDC.
Further, imposition of mining tax of 26% on PBT level would be negative for mining companies as well as for steel
companies having captive mines.
We expect excise duty and customs duties on metal products to remain at current levels of 10% and 5%,
respectively.
We believe fund-raising plans by the government through disinvestment will continue in FY2012. We believe the
FY2012 budget is likely to expedite the disinvestment process for SAIL and Hindustan Copper.
Overall, we expect the FY2012 Budget to have a Neutral impact on metal companies, while having a negative
bearing on mining companies.
Top Picks
Sterlite Industries
Hindustan Zinc
tata Steel
Sail
JSW Steel
Electrosteel Cast.
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