Hem Securities has initiated a buy rating on Tata Steel with a target price of Rs 825 in its July 4, 2008 research report. "We expect that the steel demand across the globe to remain strong but major chunk of it will be driven by Chinese consumption of steel. The company will face some pressure due to rise in coking coal and iron ore prices but as Corus has already taken into account the price hike therefore it will be able to pass the cost increase and thereby provide some relief for the combined operations."

"The stock at the current market price of Rs 623 is trading at 7.09 times to its earning per share of Rs 87.90 and 1.59 times to its book value of Rs 393.11. The stock is expected to provide huge upside potential in medium to long–term. Therefore, we are initiating ‘BUY’ signal on the stock with the target price of Rs 825 which is approximately 32 % up from the current market price of Rs 623," says Hem's research report.

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