Tata Steel Ltd. share price target

Tata Steel’s (TSL) Q4FY23 consolidated EBITDA of Rs.72.2bn (down 52% YoY) was significantly ahead of the street’s estimates, mainly due to robust standalone performance. Highlights: 1) lower coal cost and higher realisation QoQ lifted standalone EBITDA/te to Rs16,236

We maintain a HOLD rating on the stock on account of macro headwinds and the outcome overhang of the restructuring of UK assets.

Q4 demonstrated a strong comeback from a low point in India; Europe likely to recover gradually from Q2FY24

Tata Steel’s (TSL) Q3FY23 consolidated EBITDA of Rs.40.5bn (down 75% YoY) was below street estimates though in line with ours. Key points: 1) lower coking coal prices offset the impact of lower steel realisations, which lifted domestic EBITDA/te; 2) TSE operations were impacted by NRV loss of GBP55mn on slab inventory in Europe; 3) consolidated debt was static at Rs717bn;