Tata Steel shares jump 5% to fresh record high as brokerages raise target prices after Q3 results: Should you buy, sell or hold?

Tata Steel share price

• Tata Steel shares hit record high post Q3 results; brokerages raise targets
• Q3 net profit up 723% YoY to Rs 2,689.70 crore; revenue rose 6% YoY
• Brokerages maintain 'Buy' ratings, raising target prices up to Rs 240 per share

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The shares of Tata Steel jumped around 5 percent to a fresh a record high on February 9 after the company released its results for the third quarter of FY26. Brokerages raised their target prices for the stock, highlighting in-line earnings of the metal major.

The shares of the Tata Group-company hit a fresh 52-week high of Rs 206.34 apiece on Monday. It is currently among the top gainers on benchmark indices Sensex and Nifty, as well as the more-concentrated Nifty Metal index which itself is up around 2 percent.

Tata Steel Q3 Results:

Tata Steel reported a consolidated net profit of Rs 2,689.70 crore for the October-December quarter of FY26 on February 6. This marks a whopping 723 percent YoY rise from the Rs 326.64 crore net profit reported in the same period of last year.

The firm's revenue from operations meanwhile rose more than 6 percent YoY to Rs 56,646.05 crore during the quarter under review.

The metal major's net profit margin improved to 4.79 percent in Q3 FY26, from 0.55 percent in Q3 FY25. Operating EBITDA margin meanwhile rose to 14.58 percent in the third quarter of the ongoing financial year 2026.

Consolidated EBITDA for the quarter, adjusting for forex movements, was Rs 8,276 crore, higher than the Rs 7,155 crore reported in the year prior.

Production and deliveries for its India operations were higher by 12 percent and 14 percent respectively, with the Q3 deliveries of 6.04 million tonne being the first time it has breached the 6 million tonne mark, the management said.

JM Financial on Tata Steel:

JM Financial kept its 'Buy' call on the stock, while raising its target price to Rs 240 apiece from Rs 215 apiece earlier. This implies an upside potential of nearly 22 percent from the stock’s previous closing price.

The domestic brokerage said that the company’s consolidated EBTITDA of Rs 8,276 crore was marginally above its estimate of Rs 8,000 crore. "Indian operations spreads continue to trend up in tandem with higher steel prices while the European region awaits CBAM/Quota cut (June) led price hikes to sustain and trickle to margins eventually. The company expects similar Government led ring-fencing in UK ops too. Management stated net debt EBITDA target stands at 3x," it added.

JM Financial revised its earnings upwards for FY27/28 by 12-13 percent and an equivalent increase in target price to factor in an improved steel price outlook across regions.

Motilal Oswal on Tata Steel:

Motilal Oswal Financial Services said that Tata Steel’s earnings were broadly in-line with estimates, and the outlook looks bright due to the recent rise in steel prices. “Overall, TATA posted a decent performance in 3QFY26 as anticipated, primarily driven by healthy volume, offset by muted NSR in India. The combined EBITDA in Europe weakened due to muted earnings at the Netherlands operation, while the UK operating loss remained flat QoQ,” it said.

“Though there are near-term uncertainties related to price volatility due to trade barriers (CABM, tariffs, and import quota reduction), the long-term outlook remains strong for TATA. We raise our FY26E earnings (EBITDA by over 2% and PAT by over 3%), fueled by the better volume and NSR outlook. We also marginally raise our EBITDA for FY27E by 2% to reflect the improved outlook on pricing and costs,” it added.

Motilal kept its ‘Buy’ rating on the stock, while raising its target price for the stock to Rs 240 apiece, same as JM Financial.

PL Capital on Tata Steel:

PL Capital said that Tata Steel reported a strong operating performance at TSI (India), offsetting weaker TSE performance. “We cut our EBITDA estimates by 4%/1% on higher coking coal assumption and lower TSUK EBITDA and expect EBITDA CAGR of 24% over FY25-28E on the back of strong domestic pricing. At CMP, the stock is trading at 7.3x/6.4x EV of FY27/28E EBITDA. We roll forward to Mar’28 and maintain ‘Accumulate’ rating with revised TP of Rs226 valuing at higher 7.5x EV/TSI EBITDA multiple as TSI would benefit on higher prices along with strong domestic demand, structural cost transformation initiatives and higher European prices would aid faster TSE breakeven,” it said.

Emkay Global on Tata Steel:

Emkay Global maintained a ‘Buy’ rating on the stock, an increased its target price by 15 percent to Rs 230 apiece. This implies an upside potential of nearly 17 percent from the stock’s previous closing price.

“Tata Steel’s Q3 consolidated adj EBITDA of Rs82.7bn beat estimates but fell ~8% QoQ on weaker realizations and higher coking coal costs, partly offset by better volumes,” the domestic brokerage said. “The management sees sustainable EU price hikes (carbon tax, protectionism as key catalysts), near-term India price gains despite higher coal costs, and projects on track (NINL by FY29; Ludhiana EAF by Q1FY27). We raise FY27/28E EBITDA by 3–8% and TP by 15% to Rs230 (from Rs200),” it added.

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