METAL

 Citing elevated prices of coal and metal price corrections as the headwinds affect margins, Icra stated that the agency has revised its estimates to 18 per cent of operating profitability of domestic players downward in the current fiscal year

The rating agency Icra on Thursday said that the earnings of coal will continue to have a severe impact on the margins of domestic base metal players. The earnings of the primary base metal industry would remain under pressure in the second half of the current financial year. Citing elevated prices of coal and metal price corrections as the headwinds affect margins, Icra stated that the agency has revised its estimates to 18 per cent of operating profitability of domestic players downward in the current fiscal year. 

Compared to the forecast of operating profitability for domestic players done in September last year, the agency noted that it was nearly three percentage points lower, whereas, in comparison to the fiscal year 2022, the forecast was 10 percentage points lower. Group Head, Corporate Sector Ratings, ICRA, Jayanta Roy said that some relief is expected in the fiscal year 2024 from better availability of coal linkages, the profitability is expected to stay range-bound at 19-20 per cent.