Steel demand to grow led by govt spending on infrastructure

Domestic steel demand is tipped to grow in the near term on the back of strong demand led by government spending on infrastructure. The demand boost is set to partially offset cost pressures that domestic companies are likely to face in the near to medium term, ratings agency ICRABSE -0.16 % Limited has said in its latest quarterly update on the steel sector. ICRA said operating profitability of the steel industry, which comprised a sample of 22 large and mid-sized steel players, accounting for about 60% of the current domestic capacity, improved to 16% in Q2FY2018 from 12.5% in Q1FY2018 because of reduced coking coal costs and higher steel prices. Despite cost pressures, margins are expected to remain sequentially similar in Q3FY2018 beca.....