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ArcelorMittal (MT), Nippon Steel JV Secures Loan From Japan Banks
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ArcelorMittal S.A. (MT - Free Report) announced that AMNS Luxembourg Holding S.A., the parent company of AM/NS India — MT’s steelmaking joint venture with Nippon Steel Corporation in India — had signed a loan agreement worth $5 billion with a consortium of Japan banks. The banks involved in the agreement are Japan Bank for International Cooperation ("JBIC"), MUFG Bank Ltd., Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank Limited, Mizuho Bank Ltd., and Mizuho Bank Europe N.V.
The $5-billion JBIC co-financing loan will be utilized to fund the expansion of the steelmaking capacity at AM/NS India’s Hazira plant. The plant's annual production capacity is expected to increase from 9 million tons to 15 million.
The project also includes the development of downstream rolling and finishing facilities to improve AM/NS India's ability to produce high-value steels for the defense, automotive and infrastructure sectors. The expansion project, which began last October after obtaining environmental approval, is expected to generate more than 60,000 employment opportunities.
Shares of ArcelorMittal have lost 8.7% over the past year compared with a 2.7% decline recorded by its industry.
Image Source: Zacks Investment Research
The company, on its fourth-quarter earnings call, stated that it was expecting demand conditions to improve, as customer destocking peaked. The company anticipated world apparent steel consumption, excluding China, to recover 2-3% year over year in 2023.
ArcelorMittal also expects its steel shipments to grow 5% year over year in 2023. While real consumption growth is anticipated to remain dull in the United States, the expected end of destocking is predicted to lead to a rise in apparent consumption by 1.5-3.5% in 2023.
The company projects a modest decline in real demand this year in Europe. However, it expects apparent demand to recover 0.5-2.5% in 2023.
The company also expects a strong recovery in economic growth in China in 2023 as COVID-19 restrictions are being lifted. However, factoring in the sustained softness in real estate during the year, it projects steel consumption to stabilize in 2023 (+1% to -1%), with potential upside dependent on China government’s infrastructure stimulus.
Olympic Steel’s shares have gained 40% in the past year. The Zacks Consensus Estimate for ZEUS’ current-year earnings has been revised 33.1% upward in the past 60 days. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.
Steel Dynamic’s shares have gained 31% in the past year. The Zacks Consensus Estimate for STLD’s current-year earnings has been revised 40.1% upward in the past 60 days. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 11.3% on average.
Linde’s shares have gained 9% in the past year. The company has an earnings growth rate of 8.1% for the current year. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 2.5% upward in the past 60 days.
LIN topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 6% on average.
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ArcelorMittal (MT), Nippon Steel JV Secures Loan From Japan Banks
ArcelorMittal S.A. (MT - Free Report) announced that AMNS Luxembourg Holding S.A., the parent company of AM/NS India — MT’s steelmaking joint venture with Nippon Steel Corporation in India — had signed a loan agreement worth $5 billion with a consortium of Japan banks. The banks involved in the agreement are Japan Bank for International Cooperation ("JBIC"), MUFG Bank Ltd., Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank Limited, Mizuho Bank Ltd., and Mizuho Bank Europe N.V.
The $5-billion JBIC co-financing loan will be utilized to fund the expansion of the steelmaking capacity at AM/NS India’s Hazira plant. The plant's annual production capacity is expected to increase from 9 million tons to 15 million.
The project also includes the development of downstream rolling and finishing facilities to improve AM/NS India's ability to produce high-value steels for the defense, automotive and infrastructure sectors. The expansion project, which began last October after obtaining environmental approval, is expected to generate more than 60,000 employment opportunities.
Shares of ArcelorMittal have lost 8.7% over the past year compared with a 2.7% decline recorded by its industry.
Image Source: Zacks Investment Research
The company, on its fourth-quarter earnings call, stated that it was expecting demand conditions to improve, as customer destocking peaked. The company anticipated world apparent steel consumption, excluding China, to recover 2-3% year over year in 2023.
ArcelorMittal also expects its steel shipments to grow 5% year over year in 2023. While real consumption growth is anticipated to remain dull in the United States, the expected end of destocking is predicted to lead to a rise in apparent consumption by 1.5-3.5% in 2023.
The company projects a modest decline in real demand this year in Europe. However, it expects apparent demand to recover 0.5-2.5% in 2023.
The company also expects a strong recovery in economic growth in China in 2023 as COVID-19 restrictions are being lifted. However, factoring in the sustained softness in real estate during the year, it projects steel consumption to stabilize in 2023 (+1% to -1%), with potential upside dependent on China government’s infrastructure stimulus.
ArcelorMittal Price and Consensus
ArcelorMittal price-consensus-chart | ArcelorMittal Quote
Zacks Rank & Other Key Picks
ArcelorMittal currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the basic materials space are Olympic Steel, Inc. (ZEUS - Free Report) , Steel Dynamics, Inc. (STLD - Free Report) and Linde plc (LIN - Free Report) . LIN currently carries a Zacks Rank #2, and ZEUS and STLD sport a Zacks Rank #1(Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Olympic Steel’s shares have gained 40% in the past year. The Zacks Consensus Estimate for ZEUS’ current-year earnings has been revised 33.1% upward in the past 60 days. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.
Steel Dynamic’s shares have gained 31% in the past year. The Zacks Consensus Estimate for STLD’s current-year earnings has been revised 40.1% upward in the past 60 days. It topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 11.3% on average.
Linde’s shares have gained 9% in the past year. The company has an earnings growth rate of 8.1% for the current year. The Zacks Consensus Estimate for LIN’s current-year earnings has been revised 2.5% upward in the past 60 days.
LIN topped the Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 6% on average.