Tata Steel share price touched 52-week high of Rs 511, adding nearly 4 percent in the early trade on November 17 after the company reported its September quarter earnings.
On November 13, the company reported a 59.6 percent year-on-year (YoY) fall in Q2FY21 profit at Rs 1,635.4 crore, against Rs 4,043.5 crore in the corresponding quarter a year ago.
Total revenue from operations stood at Rs 37,154 crore against Rs 34,579 crore YoY. EBITDA stood at Rs 6,217 crore against Rs 3,893 crore YoY.
Also Read - Tata Steel Q2 profit falls 60% to Rs 1,635.4 crore; revenue rises to Rs 37,154 crore
Here are the brokerages view on the stock post Q2 earnings:
The research house has remained overweight and target raised to Rs 690 from Rs 565. The management has been exceeding commitments with respect to deleveraging.
The potential sale of Netherlands operations could help improve balance sheet and to give flexibility to pursue growth capex in India. It raised FY21-23 EBITDA estimates by 8-23%, reported CNBC-TV18.
Jefferies retained buy call and raised target to Rs 680 from Rs 485. Its Q2 EBITDA was up 60% YoY and India EBITDA/t should expand further in H2.
The potential sale of Netherlands plant can drive value unlocking. It has upgraded FY22-23 EPS estimates by 22-25%, reported CNBC-TV18.
Motilal Oswal has kept neutral call on the stock with a target at Rs 456. The deleveraging is a key positive with Netherlands operations divestment to SSAB could lead to further deleveraging.
The loss-making UK operations would remain an overhang. It raised FY21/FY22 EBITDA estimates by 38%/9%, reported CNBC-TV18.
Research house reiterated buy with a target raised to Rs 670 from Rs 510 and also raised FY21-23 EBITDA estimates by 7-41%. The stock factor in the higher profitability in India & Europe. The sharper than expected reduction in net debt taken in estimates, reported CNBC-TV18.
JPMorgan has remained overweight and raised target to Rs 690 from Rs 580. The IJmuiden asset is a strategic positive and should allow for at least $2.3 billion of debt reduction. Company’s net debt could fall to below Rs 70,000 crore by FY23, reported CNBC-TV18.
Edelweiss Securities retained buy and raised target to Rs 565. Also, raised FY21/22 EBITDA estimates by 27%/9%. The H2 will look much better due to higher spreads & better product mix, reported CNBC-TV18.
Kotak Institutional Equities
Kotak Institutional Equities maintained buy and raised target to Rs 635 from Rs 550. The valuations look attractive at current levels. It increased EBITDA estimates by 20%/1%/2% for FY21/22/23 mainly led by higher margins in India, reported CNBC-TV18.
Research firm has kept outperform call and raised target to Rs 630 from Rs 365. It is a preferred ferrous pick on cheap valuation and focus on deleveraging. The FY22 EPS estimates raised by 6%. The net debt down to Rs 96,500 crore, driven by working capital release & operating cash flows, reported CNBC-TV18.
At 09:21 hrs Tata Steel was quoting at Rs 510.65, up Rs 18.45, or 3.75 percent on the BSE.