New Delhi, Jan 11 (TIWN) Foreign brokerage Jefferies has downgraded Indian steel stocks and said it finds risk-reward for the country's steel far inferior to a year ago.

“We believe margins for Indian steel companies have peaked and will fall sharply by FY23, although still settle above the last 10-year average. We cut FY23 EPS for TATA/JSW Steel by 18 per cent/26 per cent ? first big cut in more than a year, and we are 23 per cent/22 per cent below street.  “After a big rise in FY21-22E, we see EPS falling 44 per cent/21 per cent YoY for TATA/JSW Steel in FY23. We assume FY23 Indian steel price of Rs 58,000 (6 per cent cut, 9 per cent below spot) and coking coal price of $230/t (36 per cent below spot).  After a year-long rally, global steel and aluminium prices have softened on weak macro and demand concerns in China.  China PMI is bottoming and policy could ease, but there is still risk of muted Chinese growth given the significance of property sector to metal demand, Jefferies said.