After two back-to-back years of earnings surge, steel companies are now staring at a significant decline in earnings over the next twelve months as the industry faces multiple headwinds emanating from trade barriers from export Duty on finished steel, unprecedented coal/ energy cost pressures, and muted domestic demand growth so far, according to rating agency ICRA.

According to ICRA’s latest note on the steel sector, the industry could therefore be on the way to an accelerated mean reversion as the operating environment becomes far less attractive in the coming months. 

Consequently, the ratings agency has revised the sector’s outlook to Stable from Positive.

Steel companies staring at significant margin correction in FY2023: ICRA

Consequently, the ratings agency has revised the sector’s outlook to Stable from Positive.

After two back-to-back years of earnings surge, steel companies are now staring at a significant decline in earnings over the next twelve months as the industry faces multiple headwinds emanating from trade barriers from export Duty on finished steel, unprecedented coal/ energy cost pressures, and muted domestic demand growth so far, according to rating agency ICRA.

According to ICRA’s latest note on the steel sector, the industry could therefore be on the way to an accelerated mean reversion as the operating environment becomes far less attractive in the coming months. 

Consequently, the ratings agency has revised the sector’s outlook to Stable from Positive.