Synopsis
At the first hint that of a Chinese economic recovery, it is metal stocks which tend to be in the limelight. Nothing wrong with that. But there are other sectors as well that stand to gain from a Chinese recovery, as demand for their products tends to spike both in China and India. The reason why they don’t hog the headlines is that they are small- or mid-sized companies supplying raw material to metal companies. Also, their stocks are not widely held. Analysts are bullish on these stocks – with most having a “Strong Buy” rating and score in the neutral territory.
The economic recovery in China is more complex than it appears. Of course, commodity prices are likely to shoot up. But it also means that the probability of dumping by Chinese companies across the globe will come down. It is well known that the Chinese sell goods much below cost of production in order to capture market share – and once that is achieved, they raise the prices and, in the long run, are able to make gains. But the immediate focus
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