1:10 Split, Rs 51 Dividend: Accumulate Tata Stock, TP Rs 170; Big Update On £1.25 Bn Investment

Prabhudas Lilladher has recommended accumulate call to Tata Group stock Tata Steel Ltd with target price of Rs 170 per share. Current market price of Tata Steel share on BSE is Rs 167 per share with intraday gain of 1.27%. Tata Steel share soared 4.75% in last 1-week only and surged over 57% in last 1-year. Tata Steel stock offered maximum return of 317% in last 10-years.

Today, the metal giant issued a media release announcing that "Tata Steel will proceed with its £1.25 Billion investment to build a state-of-the-art Electric Arc Furnace in Port Talbot and commence closure of the existing heavy end assets in the following months."

Tata Steel To Go Ahead With £1.25 Billion Investment To Build Electric Arc Furnace in Port Talbot: The media release added, "Tata Steel has informed the trade unions that Port Talbot's two Blast Furnaces No.5 and No.4 will close by end of June, and by end of September respectively. The multi-union proposal to maintain one blast furnace through the transition would have incurred at least £1.6 billion of additional costs (including higher operating costs and higher capital expenditure), created significant operational and safety risk, and put the business's future continuity in jeopardy. Discussions will continue with the trade unions during the next 2 weeks on a potential Memorandum of Understanding on the future ambitions of the business and the impact of the restructuring on employees."

Tata Steel has begun preparations to place equipment orders for the Electric Arc Furnace by September 2024, begin enabling and preparatory works at the site by December 2024, and based on current permitting timelines, begin construction on the project by August 2025, added the media release.

Tata Steel's CEO and Managing Director, Mr. T V Narendran, said: "Having looked carefully at all the options over the past seven months in consultation with union representatives, we have decided to proceed with our proposed restructuring and transition. This is the most viable proposal, in contrast to the unions' unaffordable plan which has high inherent operational and safety risk."

Tata Dividend History: Tata Steel declared its highest ever dividend of Rs 51/share in 2022 and lowest ever dividend of Rs 3.60/share in 2023. Tata Steel declared 29 dividends since May 24, 2001. In the last 12 months, Tata Steel declared an equity dividend of Rs 3.60 per share. At the current share price of Rs 167.60, Tata Steel offers a dividend yield of 2.15%, as per data available at Trendlyne.

LIC Stake In Tata Steel: Life Insurance Corporation of India (LIC) has impressive 7.29% stake in Tata Steel with 90,97,67,778 shares.

Tata Steel Turns Rs 1.06 lakh To Rs 1,70,179 lakh In 1-Year: If you bought 1000 shares of Tata Steel Ltd on April 24, 2023 at the cost of Rs 106.4 per share, you would have got a total corpus of Rs 1,66,579.8 lakh as on April 25, 2024 considering the stock offered return of 56.56% in this time period and a dividend of Rs 3.6/share in 2023. Your net profit would be Rs 60,179.84 thousand with an investment of 1,06,400.

Tata Steel Share Performance: The 52-week high price of Tata Steel share on BSE is Rs 169.75 per share (as on 09/04/2024). The metal giant company has a market capitalisation of Rs 2,09,222.50 crore. The stock has a PE of 46.95 and EPS (TTM) of 3.73. Tata Steel shares gave return of 20% year-to-date, soared 37% in last 2-years, and jumped 81% in last 3-years. In last 5-years, Tata Steel stock surged 228%.

Tata Steel Stock Split History: Tata Steel split the face value 1 time since July 28, 2022. Tata Steel last split the face value of its shares from Rs 10 to Re 1 in 2022. The share has been quoting on an ex-split basis from July 28, 2022.

Tata Steel Financials: The large cap company for the quarter ended December 31, 2023 declared its consolidated net profit at Rs 522.14 crore from the net loss of Rs 2501.95 crore announced in the corresponding quarter of last year amid robust domestic demand offsetting weakness in Europe. Tata Steel announced a net loss of Rs 6511.16 crore for Q2 as a result of impairment charges. Tata Steels' consolidated revenue from operations for December 2023 quarter fell 3% to Rs 55,311.9 crore as compared to Rs 57,083.56 crore declared in the same quarter of preceding year. Sequentially, consolidated revenue from operations fell 0.7% from Rs 55,681.93 crore in the preceding quarter.

Disclaimer: The stock has been picked from the brokerage report of Prabhudas Lilladher. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.