Tata Steel Share Price Dips 3% Despite Strong Q1 Profit; Golden Entry Point For Investors? Check Target Price

Tata Steel Share Price Today: Tata Steel shares remained under pressure on Friday, August 1, despite an improvement in its first-quarter result for the financial year 2025-26 and progress in its UK-based business.

Tata Steel shares closed 3% lower at Rs 153.05 per share on BSE on Friday with a market capitalisation of Rs 1,91,059.09 crore. The stock had touched an intraday low mark of Rs 122.60 per share on 13 January 2025.

Tata Steel's Chief Financial Officer Koushik Chatterjee, on Thursday, had highlighted that the improvement in business during the June quarter was driven by net steel realisations and strategic cost reductions.

Tata Steel Q1 Review

Tata Steel revenue fell 6% on a year-on-year basis and by 10% on a quarter on quarter basis. Revenue decline, which was driven by muted volumes during the June quarter, was in line with brokerage Motilal Oswal's estimates. The improvement in European steel operations was also in line with the brokerage's review.

Despite improvement in European steel operations, the near-term earnings outlook has deteriorated owing to recent correction in steel prices, highlighted Axis Securities in its report. "In the post result concall, the management has guided for a Rs 2,000/t QoQ decline in realization in India in Q2.W," Axis Secrities added in its report.

Tata Steel's standalone earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 5.1% annually to Rs 71.2 billion against Antique Broking's estimate of 2.5% increase. The EBITDA increase was driven by lower coking coal consumption cost, better realisation, and contollable cost reduction initiatives.

"Steel production stood at 5.07mt (+1% YoY and -3% QoQ), while deliveries were in line with our estimates at 4.75mt, declining 4% YoY and 15% QoQ. Production and deliveries were affected by maintenance shutdown in the Jamshedpur and NINL plants," Motilal Oswal added in its report.

Tata Steel Share Price Recommendations

Motilal Oswal maintained a 'Neutral' rating for the stock and revised the Tata Steel target price with a 15% upside at its current market price (as on 31 July). "TATA is trading at 7x FY27E EV/EBITDA and 2.1x FY27E P/B. We reiterate our Neutral rating with a revised SOTP-based TP of INR165 per share," noted MOFL in its report.

Underlining the weak business growth visibility in India after FY27, high leverage and finite life of iron ore cash flows, Axis Securities, maintained a 'Sell' recommendation for Tata Steel stock. The brokerage kept its target price for Tata Steel as unchanged at Rs 138 per share.

"We roll over our estimates to 1HFY28E (from FY27E earlier) and maintain BUY rating with a SoTP-based TP of INR 174 (earlier INR 165) based on an implied 6.7x 1HFY28E EV/EBITDA target multiple," noted Antique Brokerage in its report.

Tata Steel Q1 Result

Tata Steel's net profit witnessed a 112% year-on-year increase in its net profit to Rs 2.077.68 crore in the June quarter of FY26. The company had reported a net revenue of Rs 31,137 crore for the June quarter with an EBITDA of Rs 7,486 crores. The company's India EBITDA per ton improved by Rs 2,510 per ton on a sequential basis. Its crude steel production was around 5.24 million tons, and deliveries stood at 4.75 million tons.Tata Steel, in its press release, notified that its operations were affected by maintenance shutdowns in Jamshedpur and Neelachal Ispat Nigam Limited. Production and deliveries are expected to normalise in the coming quarters.

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