Tata Steel share price is firm after posting better than expected numbers and reducing debt significantly. According to the BSE filing, net debt for Tata Steel has reduced by Rs 3,000 crores QoQ to Rs 85,800 crores. Brokerages have given a thumbs up to the stock and maintained Buy or overweight rating.
Tata Steel: Brokerages positive
Most brokerages maintain a positive view on the Tata Steel stock after the Q3 numbers. JP Morgan is maintaining Overweight rating on the share with a target price of Rs 155/share.
Jefferies too maintained Buy on Tata Steel with a target price of Rs 160/share.
Morgan Stanley has an Equal weight rating on Tata Steel share price with a target of Rs 160/share.
Tata Steel stock Vs Nifty 50
he share price of Tata steel, over the past five days, has dropped by 0.62%. This decline has continued into the past month, where the stock fell by 6.56%. Further over the last six months, with a Tata steel share price saw 21.45% drop. Over the past year, Tata Steel has experienced a 5.24% decline.
In comparison, to the benchmark index, Nifty 50 index, over the past five days, the index has dropped by 0.82%, and in the last month, it fell by 3.17%. In the past six months, the Nifty 50 posted a decline of 7.85%.
But looking at the broader picture, the index has shown a 5.29% increase over the past year.
Tata Steel Q3
Tata Steel reported a 36.37% year-on-year (YoY) decline in consolidated net profit for Q3FY25, posting a profit of Rs 326.64 crore, down from Rs 513.37 crore in the same quarter last year. The company’s consolidated revenue also saw a drop of 3.01% YoY, amounting to Rs 53,648.30 crore. Despite the overall decline, Tata Steel exceeded analyst expectations, surpassing the Bloomberg consensus estimate for revenue by 3%, with analysts initially forecasting a net loss for the quarter.
On a sequential basis, the company faced a 0.48% dip in revenue and a sharp 60.81% drop in net profit. However, Tata Steel’s deliveries in India saw growth, with a 8% YoY increase to 5.29 million tonnes for Q3 and a 6% YoY increase to 15.3 million tonnes for the first nine months of FY25 (9MFY25).
Tata Steel management view
Speaking on the challenges and the performance thus far, Tata Steel Chief Executive Officer & Managing Director,T V Narendran said: “The global operating landscape continues to be shaped by geopolitics and continued economic slowdown in key regions. Subdued steel prices continued to weigh on our performance. We are progressing on enhancing sustainability in our operations at all our sites and on our commitment to diversity and inclusion.”
Koushik Chatterjee, Executive Director and Chief Financial Officer, Tata Steel added that, “Overall, cash flow from operations for the quarter stood at around Rs 8,253 crores and was aided by tight working capital management. We have spent around Rs 3,868 crores on capital expenditure and net debt has declined by around Rs 3,000 crores QoQ to Rs 85,800 crores. Our group liquidity position remains strong at Rs 28,219 crores, with cash and cash equivalents of Rs 13,119 crores.”