The Malaysian steel sector has received a positive upgrade thanks to M&A activity and iron ore concessions.

OSK Research Sdn Bhd upgraded the Malaysian steel sector to an overweight rating following recent reports of M&A fever within the country’s industry.

In a research note it said: “We think that local steel mills offer a good platform for overseas investors wishing to tap into the huge population in South East Asia, especially with the good basic infrastructure, stable utilities supply and a skilled workforce in the country.”

It said local mills with integrated set-ups present better investments compared to their neighbouring peers.