10:1 Split, 360% Dividend: Tata's Steel Stock Hits New 52-Week High; Big €3 Bn Deal Update; BUY For Rs 187/TP

Tata Group-backed steelmaker, Tata Steel Ltd witnessed strong buying on the June 7 trading session so much so that the stock hit a new 52-week high of Rs 179.65 apiece. The stock is close to its Rs 180 mark, and chances are that it may cross the level soon. In the latest trading week, the stock zoomed by over 5% on the BSE.

After market hours, Tata Steel's share price ended at Rs 178.95 apiece, up by 4.04% on BSE with a market cap of Rs 2,23,391.21 crore. YTD, the stock is up by 28% on BSE.

Tata Steel Big Announcement:

The stock of Tata Steel surged after the company confirmed the Dutch government's support in cleaning up its Europe plant.

On June 6, the company clarified in a news article titled 'Dutch May Pay as Much as €3 Billion to Clean Up Tata Steel Plant."

In FY24, the company disclosed its discussion with the Dutch government on the proposed decarbonization roadmap.

It clarified further, saying, "The Dutch Parliament, in March 2024 formally gave a mandate to the Government to negotiate the terms of potential support towards a proposal for decarbonization in Tata Steel Nederland. Subsequently, the Dutch Government has formulated a detailed framework of diligence, analysis, discussions and negotiations with Tata Steel which will run over several months before potentially culminating in an agreed set of terms."

Also, the company added that these terms will then require approval from the Netherlands Parliament as well as the Board of Tata Steel.

Hence, Tata Steel mentioned that it may be premature to draw any conclusions at this time and hence the Company is not in a position to comment any further on the news reports appearing in the mainstream media.

Tata Steel Dividend:

The steel giant has recommended a final dividend of Rs 3.60 per share for FY24, the same as the payout in FY23. For the FY24 dividend, the company fixed Friday, June 21, 2024, as the record date for determining the Members entitled to receive the same. The dividend payment date is fixed on and from July 19, 2024.

Since its bonus issue, Tata Steel has delivered a huge Rs 299 per share dividend. However, its highest dividend payout was Rs 51 per share in 2022, and cumulatively it paid Rs 63.75 per share in that year.

Meanwhile, Tata Steel has issued 1 free bonus share on the existing 1 equity share, taking the ratio to 1:1. Additionally, Tata Steel stock has also turned ex-split in 2022 in the ratio of 10:1.

Should you buy Tata Steel stock?

After the stock hit a new high, brokerage Axis Securities recommended BUY in Tata Steel shares. The entry price in the stock is Rs 178, for a target price of Rs 187 with a stop loss of Rs 187.

Among its stock trivia, the brokerage highlighted that the stock is trading very close to its all-time high. In the last 1 year Tata Steel Ltd has beaten the Nifty 50 by 38.25% (CAGR difference). For 10 out of the Last 12 Months, i.e 83% of the time it has beaten Index returns.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.