Price hike essential for steel firms to preserve margins: Edelweiss Securities

Speaking to CNBC-TV18, Amit Dixit, director-institutional equities at Edelweiss Securities, said, “This price increase, I would say, is a necessity as of now. The coking coal price is up almost 2X that is around $350-odd compared to the past three months. The price hike that you are seeing is just the tip of the iceberg because this kind of price hike has actually rendered spreads very susceptible. The coking coal is at $300 since September, actually so, on the whole, this price hike was not only necessary but also extremely essential for steel companies to preserve their margins.”

He added, “So far, we have not seen demand destruction. But if this current level of prices stays, we might see projects getting postponed. However, we will have to see how things pan out.”