Tata Steel's net profit declines over 50% YoY: Should you buy, sell or hold?

SUMMARY

Tata Steel has reported a more than 50 percent decline in its consolidated net profit at Rs 1,665.07 crore in the September 2020 quarter versus a net profit of Rs 3,302.31 in the year-ago period. Its total income stood at Rs 37,376.13 crore against Rs 34,762.73 crore in the year-ago period. The firm's total expenses were at Rs 35,244.58 crore against Rs 34,758.15 crore last year. Here's what brokerages make of the earnings:

By Pranati Deva Nov 17, 2020 9:02:31 AM IST (Published)

Morgan Stanley: The brokerage maintains an 'overweight' call on the stock after Q2 earnings and has raised the target to Rs 690 per share. It also raised FY21-23 EBITDA estimates by 8-23 percent.

Jefferies: The brokerage maintains a 'buy' call on the stock and has raised the target to Rs 680 per share from Rs 485 earlier. The brokerage believes the potential sale of the Netherlands plant can drive value unlocking.

Credit Suisse: The brokerage maintains an 'outperform' rating on the stock with target almost doubled to Rs 630 per share from Rs 365 earlier. Net debt down to Rs 96,500 crore driven by working capital release and operating cash flows, it added.

Motilal Oswal: The brokerage maintains a 'neutral' call on the stock with a target at Rs 456 per share. MOSL expects the loss-making UK to remain an overhang.

BofAML: The brokerage maintains a 'buy' call on the stock and has raised the target price to Rs 670 per share from Rs 510 earlier. It also increased its EBITDA estimates for the company factoring in higher profitability in India and Europe.

JPMorgan: The brokerage is 'overweight' on the stock and has increased its target to Rs 690 per share from Rs 580 earlier. It added that the company's net debt could fall to below Rs 70,000 crore by FY23.

Kotak: The brokerage maintains a 'buy' call on the stock with a target increased to Rs 635 per share from Rs 550 earlier. It said that valuations are attractive at the current levels.