Vedanta, NALCO, Tata Steel, HindZinc, Hindalco Crashed: Why Metal Stocks Are Falling As Precious Metals Drop?

Metal stocks witnessed a huge crash on June 23rd, amidst the decline of precious metals across the globe. On Tuesday, at MCX, where gold and copper prices plunged by around 2% each, silver declined by nearly 4%. Also, Vedanta stock, which led the top losers list, crashed nearly 8% due to a block deal. Falling commodity prices could impact revenues, profitabilities and margins of metal giants. Accordingly, Vedanta, Hindustan Zinc, NMDC, JSPL, Tata Steel and Hindalco crashed severely in the range of 3% to 8%.

Metal Stocks Fall On June 23:

The Nifty Metal index closed at 12,669.10, registering a decline of 422.10 points or 3.22% on Tuesday, emerging as the biggest dragger of the NSE Nifty benchmark.

Among stocks, Vedanta nosedived by 8%, followed by NALCO which dropped 6%. Stocks like JSPL dipped 5%, Jindal Steel declined 4.4%, and NMDC tumbled nearly 4%.

Other stocks like Adani Enterprises, JSW Steel, Tata Steek, Vedanta Oil & Gas, and Hindalco slipped by 2.7% to 3.10%. Furthermore, JSL was down 2.5%, Hindustan Copper declined 2.12%. APL Apollo slipped 1%. The only stock in green was Welspun Corp which was marginally up.

These stocks are not just heavyweights of Nifty Metal but also of Nifty and Nifty Next 50 among other indices.

Vedanta Block Deal

One of the major reasons why Vedanta fell harder than other metal stocks is the block deal worth Rs 1,890 crore. As per reports, Twin Star Holdings has likely sold a 1.7% stake in the company. The floor price was reportedly at Rs 291, hence resulting in a deep crash.

Gold, Silver, Copper Prices Crash

During the trading session of June 23rd, MCX gold price crashed by at least Rs 2,608 or 1.76% to hit an intraday low of Rs 1,45,510 per 10 grams. Meanwhile, MCX silver price took the worst hit with Rs 8,644 or 3.7% decline to hit an intraday low of Rs 2,25,666 per 1Kg. Copper also plummeted by 2.08% to hit an intraday low of Rs 1,287.9 per Kg.

As per reports, lower commodity prices could weakened earnings of metal companies.

For instance, Vedanta and Hindustan Zinc are among top producers of zinc, silver, aluminum and other metals in India. While NALCO is lead in aluminium productions. Hindalco is also engaged in aluminium and copper productions. Whereas for Tata Steel, steel prices matter more than precious metals.

"Most sectoral indices ended in red, with metals recording the sharpest decline due to falling global prices and demand concerns amid an uncertain global outlook," said Vinod Nair, Head of Research, Geojit Investments.

Which Metal Stocks To Buy?

In a latest report, analysts at Kotak Institutional Equities said, "We believe that the recent dichotomy in long and flat steel prices is transitory. Domestic rebar prices have corrected by 11% from recent peaks, while HRC prices have been largely unmoved with a mere 2-3% decline in the same period"

They believe that hikes in trade prices during Q4FY26 will likely reflect in Q1FY27. Hence, they expect the downside to be limited as domestic HRC prices are at a 7% discount to China import parity levels.

Going ahead, Kotak analysts added, "We expect margins to improve qoq, as a portion of the sharp 14%/21% increase in trade prices in 4QFY26 gets reflected in 1QFY27E. This should more than offset the increase in coal and ore prices, leading to higher qoq margins for our ferrous coverage. We continue to see better risk-reward in non-integrated steel producers-JSPL/JSTL. Maintain SELL on SAIL and TATA, given the weak growth visibility and rich valuations."

Company	Fair Value (Rs)	Rating
Jindal Steel & Power	₹1,400	ADD
JSW Steel	₹1,425	ADD
Tata Steel	₹180	SELL
SAIL	₹140	SELL
NMDC	₹100	ADD

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