NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Systematix Report
Tata Steel Ltd. continues to demonstrate strong execution on its cost‑transformation programme, delivering cost savings of Rs 8,600 crore during 9MFY26 across operating KPIs, procurement efficiencies, supply‑chain improvements and fixed‑cost rationalisation, according to Systematix. These initiatives helped partially offset the impact of weak steel spreads and elevated import pressure seen in H1 FY26.
Domestic steel pricing remained under strain due to high import inflows and seasonal demand softness. However, Systematix noted that post‑festive demand recovery and the recently imposed three‑year safeguard duty on HRC imports have eased pricing pressures since December. The brokerage expects better net sales realisations in the ongoing quarter, supported by continued cost discipline to balance rising raw‑material costs.
Systematix has cut FY26/FY27 Ebitda estimates by 13% and 6%, respectively, due to revised assumptions on realisations and costs, and has also introduced FY28 estimates. Key positives highlighted include the improving profitability at Tata Steel Netherlands, incremental volumes in India, an enriched downstream product mix, and sustained cost control measures across the portfolio. However, prolonged losses at Tata Steel UK remain a near‑term overhang.
Strategically, the brokerage believes Tata Steel's early‑mover advantage in green steel—through expansion of Electric Arc Furnace (EAF) capacities in India and overseas—positions the company to benefit from potential green‑steel premia over the medium term. This is expected to partly offset its moderate growth profile beyond the ongoing 5 MTPA Kalinganagar Phase II expansion.
Systematix estimates revenue, Ebitda and PAT CAGR of 8%, 32% and 90% over FY25–FY28, respectively. It values the India business at 6.5x FY28E EV/Ebitda and TSN/TSUK at 5x, arriving at a revised target price of Rs 230/share (up from Rs 181). The brokerage has maintained its Buy rating, considering operational improvements, structural cost benefits and strategic positioning in green steel.
Click on the attachment to read the full report:
ALSO READ: SBI Q3 Review: Motilal Oswal Remains Bullish After Stellar Quarter — Check Hiked Target Price
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
