Tata Steel (TATA) reported in line operating performance, aided by improved ASP for India business and better operating efficiencies in 1QFY24. Standalone Performance: TATA’s revenue was up 1% YoY at INR323b, in line with our estimate of INR339b. EBITDA declined 32% YoY at INR65b and was in line with our estimate of INR66b. Standalone ASP improved INR1,178/t QoQ to INR70,004/t and EBITDA/t was down by INR2,345/t QoQ to INR13,981/t (INR538/t higher than our estimate of INR13,443/t).
OutlookWe have largely maintained our estimates for FY25 to factor in the current macro-economic scenario and the stock is trading at 5.9x FY25E EV/EBITDA and 1.3x FY25E P/B. We reiterate our Neutral rating on the stock with SOTP based TP of INR120 (Previous INR110).
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