Stay 'Neutral' On Tata Steel Shares Maintains Motilal Oswal Citing Growth Plans, Strong Outlook

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Motilal Oswal Report

Tata Steel Ltd. is one of the largest players in India's steel sector and is set to benefit from improving steel price realizations, operating efficiencies, and the strong domestic demand outlook.

The implementation of the safeguard duty is expected to help domestic steel makers achieve better realization.

While near-term challenges persist due to global uncertainty around tariff escalations, the long-term outlook for Tata Steel remains strong. The Indian business is expected to continue its strong performance, and an improvement in the European business performance is likely to support overall earnings.

At current market price, Tata Steel is trading at 7.6 times EV/Ebitda and 4.1x FY27E price/book.

We believe that all the positives are well priced in. We reiterate our Neutral rating with an SOTP-based target price of Rs 180 per share on FY27 estimate.

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