According to a research report published by BOCOM International, domestic steel inventories have dropped 9% since mid-March, while April to June is the traditional peak period for steel demand, so the bank expects low inventories and high consumption to drive steel prices upward in the near future.

BOCOM International pointed out that due to the recent decline in iron ore prices compared to March, the bank expects the steel industry's profits to improve in April. Ma'anshan Steel, which accounts for a large share of construction steel in the bank's recommended product portfolio, and China Oriental Group, which has attractive valuations, believe that the recent rise in steel prices is most beneficial to them.

BOCOM International expects Ma'anshan Steel to earn 0.33 yuan per share this year, with a price-earnings ratio of 28.7 times and a net market ratio of 1.24 times. BOCOM gave it a “long-term purchase” investment rating, with a target price of 13 yuan.

China Oriental Group expects earnings of 0.44 yuan per share this year, with a price-earnings ratio of 5.9 times and a net price-earnings ratio of 0.79 times. BOCOM International has given it a “long-term purchase” investment rating, with a target price of 3.8 yuan.

Ma On Shan Steel closed at HK$4.39 for the full day; China Eastern Group closed at HK$3.02 for the full day.