Why is Tata Steel share price so low? (2023)

Why Tata Steel share price is low?

This led to expectations of lower profits in the steel industry, thus leading to selloff in metal stocks. Global brokerage firms Citi and JP Morgan had slashed the target price of Tata Steel citing fears of global recession.

On the basis of EV/EBITDA also, Tata Steel sounds good as its EV/EBITDA is 2.87 times which is comparatively lower than JSW Steel's 5.98 times. Steel prices fell sharply in June 2022 post imposition of 15 per cent export duty but average realisation stood higher by 6-12% QoQ.

#2 Reduced JLR sales puts pressure on Tata Motors

For the quarter ended 30 September 2022, JLR reported total sales of 88,121 units. This is 4.9% lower on a year on year (YoY) basis. The sales have seen a sharp decline because of the above mentioned reasons.

Promoters held 33.92 per cent stake in the company as of 30-Jun-2022, while FIIs owned 21.95 per cent, DIIs 19.02 per cent.

On the outlook of the Indian steel companies, Siddharth Oberoi, founder, Prudent Equity said, "The Indian steel producers have seen a fall in earnings due to decreased realisation, rising input costs, and low production and demand in the market.

Tata Steel Ltd. quote is equal to 106.200 INR at 2022-11-27. Based on our forecasts, a long-term increase is expected, the "Tata Steel Ltd" stock price prognosis for 2027-11-19 is 584.136 INR. With a 5-year investment, the revenue is expected to be around +450.03%.

TATA STEEL has shown a Double Bottom Chart Pattern. It is a Bullish Pattern and the Stock could Rise above 400 Levels.

The bonus formula will be applicable till 2024. The minimum and maximum annual bonus payable for 2021-22 will be Rs 41,448 + Rs 20,000 and Rs 4,58,411+ Rs 20,000 respectively.

Price-To-Earnings vs Fair Ratio: TATASTEEL is good value based on its Price-To-Earnings Ratio (4.5x) compared to the estimated Fair Price-To-Earnings Ratio (15.9x).

Can I invest in Tata?

You will pay cash to buy those Tata stocks. This cash first needs to be sent (deposited) to your broker. The most common way you can deposit your money is by bank transfer and using a credit/debit card. At some brokers, you can deposit from different electronic wallets like Paypal, e.g. at eToro.

Homegrown steel major Tata Steel on Monday reported a consolidated profit after tax (PAT) of ₹1,514 crore for the quarter ended September 2022 on the back of higher costs and weak operational performance amid a global economic slowdown.

Subscribe to Weekly Highlights. Steel price is forecast to fall in 2022 and beyon as underperforming China's demand, risks of recession in Europe and slowing global economic growth to depress demand.

Tata Steel's net debt is only 0.70 times its EBITDA. And its EBIT easily covers its interest expense, being 10.8 times the size.

Tata Steel vs JSW Steel Profit Margins (2017-2022)

It's also leading in terms of net profit margin with a five-year average of 9.3% compared to 8.2% of Tata Steel. Lower operating and non-operating costs have helped JSW Steel maintain higher profit margins than Tata Steel.

[1] Steel's support of global construction helps fuel a market valued at around $11 trillion and is expected to grow to $14 trillion by 2025. An integral part of infrastructure, steel also helps to connect people to education and social opportunities as well as support health, safety, and security.

Steel prices in general continue to move lower, following a historic run up in late 2021 and early 2022. Finding a bottom could come down to three factors, according to some market experts.

Is Tata Steel Ltd undervalued or overvalued? The key valuation ratios of Tata Steel Ltd's currently when compared to its past seem to suggest it is in the Fair zone.

In the past 12 months, Tata Steel Ltd. has declared an equity dividend amounting to Rs 51.00 per share. At the current share price of Rs 106.20, this results in a dividend yield of 48.02%. Adjusting for Bonus/Splits the dividend yield is 4.80%. See all forthcoming dividends Check out stocks with top dividend.

Which Tata share is profitable?

Shares of Orient Hotel, Tata Elxsi, Tata Power, Tejas Networks, Tata Motors, Nelco, TRF, etc. have delivered more than 50 per cent return to its positional shareholders in last one year.

Steel finds usage in various sectors including construction and infrastructure, engineering, automobiles, etc. It is an important engineering and construction material. Steel is crucial in the development of the infrastructure of any economy. Before going further, we must know some raw materials used in steel making.

Tata Steel Ltd.

For the year ending March 2022 Tata Steel has declared an equity dividend of 510.00% amounting to Rs 51 per share. At the current share price of Rs 106.20 this results in a dividend yield of 4.8%. The company has a good dividend track report and has consistently declared dividends for the last 5 years.

Future Of Steel Stocks In India

In the financial year 2022, the demand for Steel is expected to see a growth of 17% to 110 million tonnes, and the leading cause of this rise is the rising construction activities all across the Indian map. In May 2022, Tata Steel came up with a CAPEX of Rs 12,000 Crores.