Shares of Tata Steel surged over 4% in early trade on Tuesday, climbing ₹6.01 to ₹155.44 after brokerage firm Nuvama upgraded the stock to a ‘Buy’ and raised the target price to ₹177. The upgrade is based on expectations of improving profitability in European operations and a likely margin expansion starting Q1FY26.
Nuvama’s revised outlook follows Tata Steel’s Q4FY25 results, which came in line with estimates. The company posted a 16% sequential rise in standalone EBITDA at ₹7,110 crore. EBITDA per tonne also increased by ₹1,151 quarter-on-quarter to ₹12,702. Meanwhile, consolidated EBITDA rose 13% QoQ to ₹6,500 crore, despite continued losses in its UK operations.
Recovery signs were visible in the Netherlands operations, and the management highlighted a clear roadmap to achieve consolidated profitability in Europe in upcoming quarters.
Looking ahead, Nuvama expects EBITDA per tonne to increase by nearly ₹2,000 in Q1FY26, driven by higher steel prices and easing coal costs. While seasonal demand may soften volumes, Europe operations are projected to turn EBITDA-positive from Q1FY26, aided by efficiency gains and cost management.
The brokerage has also raised FY27 EBITDA estimates by 6%, citing structural gains from the European business and improved cost structures. Tata Steel is seen to be entering a phase of earnings revival, supported by ongoing capital and cost optimizations.
As of 9:28 AM, Tata Steel shares were trading at ₹155.44, up 4.02%. The stock’s market capitalization stood at ₹1.94 lakh crore.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
