BSE Code: | NSE Code: | ISIN: | Sector:
Research Report Detail
|Report Date||Call||Price@Call||Target Price
|Current Status||Time Horizon|
|Open|| Long (1Y)
HDFC Securities initiates Tata Steel with buy
Tata Steel delivered strong numbers
(consolidated EBITDA/APAT 53.4%/4.7x YoY),
as both Indian and European operations delivered healthy EBITDA/t of
Rs 10,786 and USD 80, respectively.
Reported profits were boosted owing to FX gains (Rs 5.4bn) in the subsidiaries.
Domestic steel companies are in a sweet spot, given protective measures should
global steel prices fall (Currently at an 8-month high). Tata Steel is now reaping
benefits from increased domestic capacity and persistently strong profitability in
both India and Europe. It is also close to finalising a Regulated Apportionment
Agreement (RAA) for its UK Pension Scheme (BSPS), also apparent in the cash
accretion (GBP 550mn build-up in 1QFY18).
A potential JV with ThyssenKrupp in Europe should aid further