InvestorQ : Why have metal stocks like Vedanta and auto stocks like Tata Motors corrected so sharply on the last trading day of February 2020?
Ria Jain made post

Why have metal stocks like Vedanta and auto stocks like Tata Motors corrected so sharply on the last trading day of February 2020?

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Anu Biswas answered.
1 year ago
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Both the stocks are down for a different set of reasons altogether. But the ultimate reason is the same and that is the Chinese Coronavirus although the impact is something different. In case of Vedanta, the concern is that the weak growth in China will reduce investments in metals and hence the demand for minerals. That is likely to put an outer limit on the growth outlook for Vedanta and the company could actually see pressure on top line and on bottom line. In the case of Tata Motors, the issue is a bit of supply chain disruption and also because China is the largest market for JLR products. For example, Indian auto companies rely heavily on China for supply of inputs and that is putting the pressure on auto companies as their production schedules are getting hit. This is true of all auto companies, although Chinese demand is more pronounced in case of JLR.

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