Stuck in Tata Steel shares since January 2022? Here's what you should do

Shares of the Tata Group’s metal arm Tata Steel have underperformed their peers since January last year. The Tata Steel stock is trading at a discount of 2.5% compared to the high of Rs 111.15 on December 31, 2021. However, the BSE metal index has gained 399 pts or 2.07 % since January 2021. The index surged from 19, 245 on December 31, 2021 to 19,644 in the current trading session. During the same period, shares of Jindal Steel and Power Ltd (JSPL) have surged 35.29%, rising from Rs 205.75 on December 31, 2021 to Rs 583 in the current trading session.

Shares of another peer Jindal Stainless have zoomed 61.45% to Rs 320 today against the close of Rs 198.20 on December 31, 2021. On same lines, the stock of Coal India has surged 52% since  January 2022. It has climbed from Rs 146 on December 31, 2021 to Rs 222 in the current session.

Meanwhile, the benchmark Sensex has lost 0.25% from 58,253 to 58,102 during the same period. In the current session, the Tata Steel stock is up 1.93% to Rs 108.45 on BSE against the previous close of Rs 106.45 on BSE. The Tata Group stock has gained after three days of consecutive fall.

Shares of Tata Steel touched an intraday high of Rs 108.9, rising 2.3% on BSE.

Total 14.75 lakh shares of the firm changed hands amounting to a turnover of Rs 15.98 crore. The stock hit a 52-week high of Rs 138.63 on April 6, 2022 and a 52-week low of Rs 82.71 on June 23, 2022.

In terms of technicals, the relative strength index (RSI) of Tata Steel stands at 40.7, signaling it's neither trading in the overbought nor in the oversold territory. The stock has a beta of 1.3, indicating very high volatility in a year. Shares of Tata Steel are trading higher than the 5 day, 20 day and 200 day moving averages but lower than 50 day and 100 day moving averages.

Here’s a look at what brokerages and analysts said about the outlook of Tata Steel stock.

Vaishali Parekh, Vice President - Technical Research at Prabhudas Lilladher said, "Tata Steel after the correction witnessed has come near the significant 200DMA level of Rs 105 and witnessed a consolidation at that zone to suggest bottoming out for the stock and with a pullback visible is anticipated to carry on with the positive move still further ahead. The RSI has indicated a trend reversal from the oversold zone and is well placed at current price rate. We expect the stock to move ahead for initial target of Rs 115 and thereafter Rs 124-127 zone if it breaches Rs 115 zone decisively."

Abhijeet from Tips2trade said, "Tata Steel has a strong support at Rs 101. A daily close above  Rs 125 should trigger a strong uptrend till Rs 165 over a longer term period.

 Brokerage Jefferies has assigned a Buy call on Tata Steel with a target price of Rs 145 apiece.

"For Tata in particular, the European business (TSE) contributes just Rs 11 per share of EV to our price target of Rs 145. We see the recent underperformance as a buying opportunity in Indian metals; our top pick is Tata, followed by Hindalco," the brokerage said.

Brokerage and research firm BOBCaps said it prefers Tata Steel with a target price of Rs 140. The brokerage has Buy rating on Tata Steel.

Also read: These three Adani Group stocks hit lower circuits for second straight session

Also read: Adani Enterprises, Adani Total Gas, Adani Wilmar, Adani Transmission shares in focus on recovery hopes from Tuesday’s lows