Shares of Tata Steel were among the top Sensex gainers today as market rebounded in line with positive global cues. The Tata Steel stock breached the Rs 100 mark in opening deals and looked set to close above the three figure mark amid a strong domestic market rally. Sensex zoomed 1,067 points to 57,856 and Nifty gained 312 points to 17,200 in early trade today.
If Tata Steel stock closes above Rs 100 today, it would do so after a span of six trading sessions. The stock ended at Rs 104.25 on September 23 this year. In the very next session, it closed below the Rs 100 mark at Rs 99.85 amid highly volatile global markets.
Sentiments around the stock were also supported by reports that Odisha-based Neelachal Ispat Nigam has resumed operations nearly 90 days after it was bought by a Tata Steel subsidiary for Rs 12,000 crore in a bidding process. The plant with a 1.1 million tonne steel-making capacity was closed for almost two years on account of various reasons.
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Tata Steel Long Products (TSLP), an arm of Tata Steel, said it achieved a milestone with the restarting of the blast furnace at its subsidiary NINL, just 90 days after the completion of its acquisition on July 4, 2022.
Meanwhile, the stock rose up to 3.26 per cent to Rs 101.50 in early trade against the previous close of Rs 98.30 on BSE. Shares of Tata Steel are trading higher than the 5 day moving averages but lower than 20 day, 50 day, 100 day and 200 day moving averages.
The large cap stock has lost 24 per cent in a year and fallen 9.54 per cent in 2022. Shares of Tata Steel have declined 29.70 per cent from their 52-week high of Rs 142.62 hit on October 19, 2021.
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Market cap of the Tata Group firm rose to Rs 1.22 lakh crore on BSE. Total 6.82 lakh shares of the firm changed hand amounting to a turnover of Rs 6.86 crore.
The Tata Group firm logged a 21 per cent fall in its consolidated net profit in the first quarter of the current financial year. The steel major logged a consolidated net profit of Rs 7,714 crore for the quarter ended June 30, 2022 against Rs 9,768 crore in the corresponding quarter of FY22.
With the stock breaching the Rs 100 mark after six sessions, here's a look at what analysts said about the outlook of Tata Steel.
Abhijeet from Tips2trade said, "A global meltdown especially in US and Europe has triggered a panic sell off in global indices with metal stocks including Tata Steel bearing the brunt. Rs 94 will be an immediate support with very strong support at Rs 90.5. Till Tata Steel doesn't close above Rs 101 on daily charts, investors should avoid buying."
Tirthankar Das, Technical & Derivative Analyst, Retail, Ashika Stock Broking said, "The volume trend has shown an accumulation in Tata Steel for the past few months, thus indicating an increased enthusiasm to push prices higher while the latter lacks volume participation. Hence, it can be expected Tata Steel to witness a strong upmove and head towards Rs 140- Rs 150 in medium to long-term perspective (measuring implication of the bullish downward sloping channel)."
Ravi Singh, vice president and head of research, Share India said, "The weakness in international prices and subdued demand have driven down the domestic steel prices. Tata Steel is on an expansion mode and requires large capital. The cost of financing may also get adversely affected by the rising interest rate. The current volatility in rupee is also working against the import dependence and offshore business of the company. However, Tata Steel's strong cash flow on the back of robust operating performance is posting confidence on its future perspective. The stock may witness lower levels buying for the target of Rs 100 in the short term and Rs 107 levels for the long term."