Tata Steel shares slid over 3 per cent on Monday after Goldman Sachs downgraded stocks to ‘sell’ from ‘neutral’ and said the stock is pricing in most of the potentially positive drivers such as higher profitability and sale of UK assets. The share price of the company closed 3.33 per cent down at Rs 323.80 on Monday.
The brokerage house further added that valuations of Tata Steel look expensive even after assuming higher steel prices and a turnaround in Europe. It added, “Fall in Europe steel prices would further weigh on Tata Steel shares.”
Seventeen of the 37 brokerages covering the stock rate it ‘sell’ or lower, 11 ‘hold’ and nine ‘buy’ or higher, according to Thomson Reuters Eikon data.
For the quarter ended March 31, 2016, the company reported a consolidated net loss of Rs 3213.76 crore against net loss of Rs 5674.29 crore in the corresponding quarter a year ago.
On a year-to-date basis, shares of Tata Steel surged 30.18 per cent to Rs 334.95 till June 10, whereas BSE Sensex gained 1.82 per cent during the same period.
(With agency inputs)