Tata Steel, Cholamandalam, PB Fintech, Mankind Pharma, Godrej Properties, Thermax, Symphony & More Q1 Review

HDFC Securities maintains Buy on Tata Steel with a revised target price of Rs 170/share (6.5x its FY27E consolidated Ebitda). Cholamandalam Investment and Finance Company Ltd.’s Q1 FY26 earnings were in line with our estimates, with higher other income offset by higher credit costs.

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HDFC Securities Institutional Equities

Tata Steel - Steel price uptick and cost-take outs boost margin

We maintain Buy on Tata Steel Ltd. with a revised target price of Rs 170/share (6.5x its FY27E consolidated Ebitda). While maintenance shutdowns in India led to 4% YoY volume decline in Q1 FY26, Tata Steel reported 11/77% Ebitda/APAT YoY, driven by steel pricing gains both in India and Europe and realization of cost transformation program.

We expect the ramp-up of the Kalinganagar plant to drive 5% YoY volume growth in FY26, despite a decline in Q1 FY26. Riding on expected turnaround in Europe operations, gains from ongoing cost transformation programs (across all locations), and lower coking coal prices, we estimate 31% consolidated Ebitda CAGR during FY25-27E.

Cholamandalam - Weak macro testing portfolio resilience

Cholamandalam Investment and Finance Company Ltd.’s Q1 FY26 earnings were in line with our estimates, with higher other income offset by higher credit costs. However, the operating performance was relatively subdued with moderating AUM/disbursements growth of 23.6%/0% YoY and sharp uptick in credit costs (1.9%) in a seasonally weak quarter.

Disbursements moderated significantly in home loans (-0.8% YoY), Consumer and Small Enterprise Loans (-41% YoY), and SME (-21% YoY), while credit costs inched up significantly in vehicle (2.2%) and CSEL segment (6.7%).

Management attributed subdued performance to broader economic slowdown and expects disbursements and asset quality to improve by Q3, with expected revival in economic activity.

However, higher-than-expected credit costs for several quarters, along with moderating loan growth, poses downside risk to our estimates, although RoE is expected to remain robust (~19-20%).

We maintain Add with an unchanged RI-based target price of Rs 1,590 (implying 4.1x Mar-27 adjusted book value per share).

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