Stock Insight: Wealth Mining

As emerging economies mature into developed nations, people grow richer and as a consequence they demand better infrastructure, improved living, more cars and household appliances. These, in turn, generate a huge demand for raw materials. Though China has been growing at a break-neck pace for over a decade now, the demand for industrial inputs is likely to remain robust in the near future. Ditto for other developing countries in Asia, given the size of their populations, their use of raw materials is still modest. By 2010 the global demand for imported iron ore (one of the key commoditied for industrialisation) will be 903 million tonnes, representing a growth of 5.5 oer cent a year. On the domestic front too, India is expected to see a three-fold increase in demand for raw-materials in 10 years as the focus on expenditure and infrastructure spending increases. All these auger well for companies, like Sesa Goa, operating in the iron ore mining space. Rising iron ore prices, increasing demand in the international market and the rapid increase in global steel capacities improve the prospects for Sesa Goa. Moreover, the company's strategic loca

This article was originally published on October 01, 2006.