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Explained — Three important factors behind the Metals outperformance and the road aheadThe ongoing quarter, which ends on March 31, will also see steel companies see an expansion in the margins compared to the same quarter last year, owing to a combination of multiple factors.By Nigel D'Souza  February 25, 2026, 9:45:00 AM IST (Published)2 Min ReadMetal stocks are extending their outperformance on Wednesday, February 25. The Nifty Metal index has become the third-best performing sectoral index in February, having gained 7.6% so far this month.

Four Nifty Metal Constituents, Tata Steel, Adani Enterprises, Jindal Steel and Lloyds Metal have gained between 10% to 13% so far this month, while shares of SAIL and Vedanta are up between 9% to 10% each.

A weaker US Dollar index, hopes of no demand destruction and potential increase in demand for aluminium and copper due to the data center boom are some of the most important factors driving this outperformance.

The ongoing quarter, which ends on March 31, will also see steel companies see an expansion in the margins compared to the same quarter last year, owing to a combination of multiple factors. First, price hikes taken by steel companies between ₹5,000 to ₹6,000 per tonne in flat products and long products between ₹9,000 to ₹10,000 per tonne, are protected by safeguard duties.

Additionally, in a seasonally strong period, steel demand is expected to increase as well.

The Road Ahead

Brokerage firm Macquarie believes that Indian steel price risk is skewed to the upside in the near-term, reflecting that domestic steel demand remains strong and that prices are at a modest premium to import parity, despite a 9% hike in domestic prices since mid-December 2025.

It has added JSW Steel as a "Marquee Buy Idea" with a price target of ₹1,319.

On Wednesday, BoFA Securities also upgraded Vedanta to "buy" from "neutral" earlier and raised its price target by 75% to ₹840 from ₹480 earlier. You can on that here.

Nomura has also initiated coverage on Lloyd Metals with a "buy" rating and a price target of ₹1,600, backed by low-cost iron ore assets till 2057, steel integration, predictable earnings and diversification into copper.

Nomura expects Lloyds to report an Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of ₹10,900 crore in financial year 2028, compared to ₹1,900 crore in financial year 2025, implying a Compounded Annual Growth Rate (CAGR) of 77%.

The Nifty Metal index is the sectoral gainer on Wednesday, trading with gains of 1.5% and all sectoral constituents are trading with gains, led by Lloyds Metal and Vedanta.Continue ReadingTagsLloyds Metalsmetal stocksNifty Metalshare market todaysteel pricesVedanta Share Price