Daily Brief Energy/Materials: JSW Steel Ltd, Source Rock Royalties, S&P/ASX 200, Iron Ore, Vedanta Resources, Newmarket Corp, Canyon Resources, Reliance Steel & Aluminum, Vale and more

• JSW Steel Ltd (JSTL IN)‘s resolution plan for Bhushan Power & Steel was rejected by the Supreme Court, ordering its liquidation.
• The rejection undermines JSW Steel’s capacity expansion and investment plans, leading to significant financial and strategic setbacks.
• The ruling highlights the importance of strict adherence to IBC provisions and raises concerns over the predictability of large asset resolutions.

• Source Rock is an oil and gas royalty company with interests in lands across Saskatchewan and Alberta.
• SRR has grown average daily production at a 16% CAGR since 2021, resulting in adjusted EBITDA growing at a 22% CAGR.
• Source Rock offers a >9% dividend yield which has grown at 2.5% annually since initiating the dividend in 2014.

• Over the past three weeks, the S&P/ASX 200 (AS51 INDEX) has staged one of the strongest rebounds since the early April Trump-tariff shock, rallying approximately +15% from its 16-month low.
• Several factors are driving the rally: recent passive flow activity, as highlighted by Brian Freitas but also broad-based sector strength, with notable gains in energy, healthcare, and consumer staples.
• Despite a positive outlook, our models indicate the index is currently OVERBOUGHT. This insight breaks down the key details.

• SGX Iron Ore Futures fell 4.3% WoW to $95.85/ton, closing just above S2 support as bearish momentum strengthened
• Prices are trading below all key moving averages, with a recent death cross and RSI at 38.17, indicating continued downside risk
• Managed Money and Physicals turned net short, while total futures and options open interest rose 4.2% WoW, reflecting rising bearish positioning

• US markets were in risk-on mode overnight, amid strong earnings from tech companies.
• The S&P 500 was up 0.6% for the eighth consecutive day, while the Nasdaq gained 1.5%.
• US Treasuries steepened, with the 2Y yield shrinking by 5 bps but the 30Y gaining 3 bps as investors slightly curbed their bets on US interest-rate cuts this year given factory activity data, while keeping the inflation expectation further out.

• NewMarket Corporation’s first quarter of 2025 results present a complex financial landscape characterized by both strengths and challenges.
• The company reported a net income of $126 million, translating to $13.26 per share, a notable increase from $108 million, or $11.23 per share, in the same quarter the previous year.
• This positive growth in net income suggests strong profitability management, despite facing a decline in sales figures in some segments.

Canyon Resources has received an approval that grants it land access at the established port of Douala. With rail access already secured through the investment in Camrail, this is the final infrastructure agreement required for the development of the Minim Martap project. It also paves the way for the company’s majority shareholder, Eagle Eye Asset Holdings (EEA), to exercise its 500m options that will bring in A$35m. Access to rail and port significantly de-risks the project, supporting Canyon’s target of first shipment in H126. We maintain our project level NPV at US$566m (A$889m).

• Reliance Inc.’s first-quarter performance in 2025 highlighted both robust financial metrics and some challenges emerging from the broader economic landscape.
• The company reported a non-GAAP earnings per share of $3.77, surpassing internal projections, signifying strength despite prevailing market uncertainty.
• This outperformance was driven by a 12.8% increase in tons sold compared to the previous quarter, attributed both to organic growth and the incorporation of four acquisitions made in 2024.

• Vale is guiding for stable iron ore production of 325–335 Mt in 2025 and steady copper and nickel growth, supported by disciplined capex and portfolio optimization.
• While dam reparation exposures are fully provisioned, execution risks around ongoing environmental obligations and community projects remain a critical overhang.
• The stock appears cheap at ~3.1x EV/EBITDA but looks relatively expensive on a reserve-based valuation, reflecting the market’s cautious view on long-term growth visibility and external risks.

• Vale S.A.’s first-quarter 2025 earnings report offers a nuanced view of its performance amid dynamic market conditions and strategic initiatives.
• Starting with an increase in iron ore sales by 4% year-on-year to 66 million tons, the company effectively managed its integrated supply chain despite a 4% decrease in production caused by higher rainfall in critical mining regions.
• Vale continues to focus on operational excellence, as evidenced by the S11D project achieving its highest production for the first quarter, driven by asset reliability improvements.