fell 5 per cent in early trade on Monday after investors reacted cautiously to the company’s March quarter earnings and mixed brokerage commentary, with concerns around regulatory headwinds in Europe and delays in key overseas projects weighing on sentiment despite a sharp rise in profit.
The stock declined to ₹206.69 on the NSE, down from the previous close of ₹216.84, emerging as the top loser on the Nifty 50 index.
Tata Steel shares fall
The company reported a compared to ₹1,200 crore in the year-ago period, aided by better realisations. Revenue rose 13 per cent y-o-y to ₹62,687 crore from ₹55,707 crore. The company also announced a dividend of ₹4 per share.
Brokerages maintained a mixed stance on the stock following the results. Jefferies maintained a buy rating and raised its price target to ₹275. The brokerage increased its FY27 and FY28 EPS estimates by 6 per cent to 14 per cent and expects the India business to deliver 9 per cent volume growth along with margin expansion in FY27. It said India remains the key driver for Tata Steel’s stock performance despite ongoing regulatory concerns in Europe.
Morgan Stanley retained its overweight rating with a price target of ₹215. The brokerage said Tata Steel delivered a strong performance across domestic and overseas operations and expects the near-term outlook to remain favourable, aided by higher India prices and policy support in the UK and EU.
JPMorgan downgraded the stock to neutral with a price target of ₹220 after the stock rallied 38 per cent over the past year, compared to a 5.5 per cent decline in the Nifty. The brokerage cited regulatory cost pressures in the Netherlands business, including risks linked to early closure of coke and gas plants, which could increase raw material, freight and employee restructuring costs. It also highlighted delays in the UK electric arc furnace project and the India NINL expansion.
CLSA maintained a hold rating on Tata Steel with a price target of ₹225. Investec maintained a hold rating with a target price of ₹240, citing strong earnings supported by resilient India operations and reduced losses in Europe, along with improving domestic spreads in Q1FY27.
Goldman Sachs maintained a neutral rating with a price target of ₹218. The brokerage highlighted positive price-cost spreads across geographies in Q1FY27, likely India volume growth of 7 per cent in FY27 and expectations of the UK business achieving EBITDA break-even. However, it flagged regulatory challenges in the Netherlands and delays in the UK EAF ramp-up.
Meanwhile, Citi retained a sell rating with a target price of ₹200. The brokerage said adjusted EBITDA of ₹9,950 crore came in 5 per cent above estimates and increased 20 per cent q-o-q, supported by improved India realisations and lower losses in the UK. However, it remained cautious due to uncertainty around environmental regulations in the Netherlands and slower growth visibility beyond FY27.