Tata Steel shares rebound 35% from 52-week low; can they hit Rs 150 mark?

Shares of Tata Steel Ltd have surged 35% from their 52-week low hit last year. The stock fell to a 52-week low of Rs 95 on September 28, 2022 and rose to an intraday high of Rs 128.95 in the current session, implying a gain of 35.76% during the period. On the other hand, Sensex climbed 15.72% in a year. The stock hit a 52 week high of Rs 134.85 on September 18, 2023.   

In the current session, the Tata Group’s metal stock opened marginally higher at Rs 128.95 against the previous close of Rs 128.85 on BSE. The metal stock has gained 7.25% this year. Total 12.76 lakh shares of the firm changed hands amounting to a turnover of Rs 16.29 crore. Market cap of the Tata Group firm stood at Rs 1.56 lakh crore in the afternoon session.       

In terms of technicals, the relative strength index (RSI) of Tata Steel stands at 57.9, signaling it's neither trading in the overbought nor in the oversold territory.  

The stock has a beta of 1.3, indicating high volatility in a year. Tata Steel shares are trading higher than the 5 day, 30 day 50 day, 100 day, 150 day and 200 day moving averages but lower than the 10 day, 20 day moving averages.          

Here’s a look at what technical analysts and brokerages said on the outlook of the Tata Group stock.  

Aditya Gaggar, Director of Progressive Shares  said, “In July, Tata Steel Ltd gave a breakout from the Symmetrical Triangle Formation which was not only confirmed with a positive crossover in MACD but also with a surge in volume. After completing its pullback move, follow-up buying was seen recently. The leading momentum indicator RSI replicates price activity and ADX also suggests building up the momentum. We had initiated a report (1st August 2023) on the stock at a price of Rs 123 with a decline up to Rs117 for the targets of Rs147-Rs 172.” 

Phillip Capital has assigned a target of Rs 150 with a buy call. "We believe that worse is largely over for Europe and in the medium-term, operating  performance  will  remain  healthy  aided  by  cost  rationalisations. Incremental volumes from India business will be margin accretive and will help to tone down debt despite capex.We continue to have positive stance on the company and maintain our Buy rating on the stock with Target price of Rs 150 (6.0x FY25 EV/EBITDA)," said the brokerage.  

Abhijeet from Tips2trades said, "Tata Steel has turned bearish on the Daily charts with strong resistance at Rs 132. A daily close below support of Rs 124 could lead to a sharp fall till Rs 115 in the near term."  

 ICICI Securities has maintained an add call to the stock with a target of Rs 150.  

"The development around Tata Steel UK is likely to ensure the future readiness of the business from both profitability and ESG perspective. We expect both additional restructuring costs  and  policy  support  as  consultation  process  picks  up. Taking cognizance of  better  operating  prospects  of  Tata  Steel UK and  reduced  support  from  the parent, we raise our valuation multiple to 6x (earlier 5.5x),resulting in a revised target price of Rs 150 (earlier Rs 135). Maintain ADD rating on Tata Steel stock,” the brokerage said.  

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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