Tata Steel’s share price touched a six-month high on Monday this week after rising for five consecutive sessions. This came shortly after the Ministry of Finance scrapped the 15% export duty on steel products and iron ore. Exports are an important revenue stream for Tata Steel, and it features in a screener that lists top Indian exporters among listed companies. Other steel companies also rose as Nifty Metal increased over 3% in the same week.  

Share prices of steel companies were on an uptrend at the start of 2022 on the back of strong domestic and global steel demand. On February 28, Tata Steel’s share price started rising after its arm Tata Steel Advanced Materials acquired a 90% stake in Ceramat. This acquisition was to help the company set up a facility to produce medical materials. 

In early May, the company’s share price began to rise after posting strong Q4FY22 results. But this rise was cut short by the government’s decision to impose export duty on iron ore lumps and fines, iron ore pellets and certain steel products. Export duty on different forms of alloy and non-alloy steel, including pig iron, was hiked from zero to 15% to increase their domestic availability and curb soaring prices. This caused the steel and iron manufacturers to tumble; Tata Steel fell 10.9% during the week ending May 22. 

On June 8, the company reported an acquisition of a 22.5% stake in its associate company, TRF. This acquisition was to help TRF in meeting its working capital requirements and clear at least a part of its existing debt. Although Tata Steel closed in the green (1.7%) on the day of acquisition, it fell over 11% during that week.

However, its share price started rising again post its Q1FY23 results in July. Though the company’s net profit fell 12% YoY, it beat forecaster estimates by 26%, which excited  investors. The recent decision to scrap export duty on November 19 also helped the share price recover. 

Tata Steel’s share price has been volatile in 2022, to say the least. It has a beta of 1.3, which indicates high volatility. Corporate events like acquisitions, earnings announcements and government regulations like levying and scrapping of export duty affected the share price during the year.