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Tata Steel shares surge 240% in a year; global brokerage retains 'buy'

CLSA has maintained a buy call on the stock with a target of Rs 1,462 per share.

July 05, 2021 / 09:52 AM IST
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Tata Steel share price added a percent at open on July 5. The stock has zoomed over 240 percent in the 12 months. It is trading at Rs 1,142.85, up Rs 6.90, or 0.61 percent at 09:17 hours. It has touched an intraday high of Rs 1,150 and an intraday low of Rs 1,141.

The steel maker's crude steel production was up 55 percent in the first quarter of FY22 to 4.62 million tonnes as against the same period last year. Its India deliveries rose by 42 percent in the period under review to 4.15 million tonnes on a year-on-year basis.

However, the crude steel production decreased 2.6 percent QoQ due to the supply of over 47,800 tons of liquid medical oxygen to hospitals amid the second Covid wave, Tata Steel India said in a regulatory filing.

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Tata Steel Europe's steel production grew by 27 percent YoY to 2.73 million tonnes while steel deliveries increased by 19 percent YoY.

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Global research firm CLSA has maintained a buy call on the stock with a target of Rs 1,462 per share. It is of the view that the expected margin is likely to improve further from the decadal high of Q4, adding that despite Europe volume falling 5 percent QoQ, spreads are higher at USD 300 per tonne QoQ.

"Tata Steel will benefit from higher steel prices in India and strong Spreads in Europe," CLSA said.

Pritesh Mehta, Lead Technical Analyst - Institutional Equities at YES Securities has a buy call on the stock with a target of Rs 1,750 per share. "Metals, so far, have had an incredible year. The Nifty Metal index has rallied more than 60 percent in the first six months of 2021. It went through a sideways corrective zone from May to June," he said.

"Within the space, Tata Steel is outperforming Nifty and metal indices both. On P&F chart (0.5%*3), Tata Steel has staged a bullish turtle breakout, rising double top buy and bullish continuation post bullish anchor column, suggesting a move towards Rs1,750 in next 6 months. Support for the same is placed at Rs 1,020," he added.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Moneycontrol News
first published: Jul 5, 2021 09:52 am

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