Metal and Chemical Stocks; Still Good to hold them?

metal chemical stocks

This week, many new stocks or sectors saw a great momentum in their stock prices. Few touched new highs but few of them saw huge selling pressure at higher levels. Today’s post is especially to talk on them.

Graphite and Carbon stocks, among top active pockets in market…..

After a great buying in Graphite and Carbon stocks last year, starting of this year also proved to be lucky one for them. Over 15 percent surge came in chemical stocks this week. Graphite India, HEG etc all made a new high. However, today’s trading session was not so good for them. Most of them saw profit buying by the end of the day.

In recent months, hike in prices of graphite and increasing focus on Electrical vehicles had trigged a buying opportunity in chemical stocks. But as valuation wise, stocks value have now already discounted this opportunity. Many chemical stocks like HEG have seen more than 10 times stock price appreciation in last one year. And now , one can still choose to hold these stocks only if have a long-term view. For short-term, I don’t think that Risk Reward ratio is favourable. Therefore, I would suggest to avoid any fresh position at current levels if you have a short-term view. And also, you can also try to hold or buy those stocks for long-term, where Attractive valuations + potential upside also exist to earn great returns in next 2-3 year.

Metal stocks on a continuous rise….

In last few days, metal stocks have also seen some good buying especially those were quoting at attractive valuations. Jindal steel rose more than 10 percent intraday, while other metal stocks also surge.

In my recent post, I had suggested to hold Tata steel for long-term. I think in this stock, we can see some interesting buying in next 1-2 years. You can read it here Why Tata steel looks attractive for long-term?

Many other metal stocks like Sail, Vedanta etc. also have seen good buying in last 3-4 days of this new year. In JSPL, i think those who have bought it at lower levels can now start profit booking. In higher levels, chances of having more good buying is now low. Even, those who had bought it for short-term at lower levels can also try to exit at current levels. But those who have long-term view, can still try to hold JSPL.

In other metal stocks, I think in next 1-2 years, we can see some more buying which would be beneficial for long-term investors.



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