Tata Steel shares surge over 5% despite loss in December quarter; brokerage rating 'neutral'

Shares of Tata Steel surged over 5 per cent on Friday even as the steel giant reported a consolidated net loss of Rs 2,127.23 crore for the quarter ended December 31, 2015 hit by subdued demand in India as well as higher regulatory costs and a strong British pound.

The stock of Tata Steel hit an intraday high of Rs 239.10, up 5.72 per cent on the Bombay Stock Exchange (BSE).

The stock tanked 5 per cent in the early trade but wiped off entire losses to end 3.47 per cent higher.

Broking firm Angel Broking retained its 'neutral' rating on the stock.

"Indian steel demand remained subdued post monsoon quarter due to sluggish uptick across key steel consuming sectors like construction, general engineering and infrastructure," Tata Steel said in a filing to BSE.

Rural demand also remained muted. Oversupply in global steel markets coupled with relative stability of Indian rupee versus dollar as compared to other and currencies has made India a favoured import destination, the company added.

On its European operations, the firm said: "Surging imports into Europe exerted further pressure on margins in the last quarter.