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Last Updated on: 21 July, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 500470 | NSE: TATASTEEL

Fundamental Analysis of Tata Steel Ltd

Basic Stock Data of Tata Steel Ltd

Last Updated: July 20, 2024, 11:09 pm

Market Cap 1,96,953 Cr.
Current Price 158
High / Low185/114
Stock P/E30.8
Book Value 73.7
Dividend Yield2.28 %
ROCE7.02 %
ROE6.55 %
Face Value 1.00
PEG Ratio-1.11

Data Source: screener.in

Competitors of Tata Steel Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Beekay Steel Industries Ltd 1,364 Cr. 715845/53710.3 4940.14 %14.6 %15.2 % 10.0
Aerpace Industries Ltd 504 Cr. 36.936.9/2.53 0.940.00 %12.7 %15.8 % 1.00
SAL Steel Ltd 172 Cr. 20.330.6/13.8367 4.950.00 %8.02 %1.12 % 10.0
Eastcoast Steel Ltd 13.5 Cr. 25.035.1/17.7 35.90.00 %0.18 %0.15 % 10.0
JSW Steel Ltd 2,17,511 Cr. 889959/72331.2 3180.82 %13.3 %11.8 % 1.00
Industry Average20,567.25 Cr372.3459.43162.370.15%9.31%7.71%7.60

Tata Steel Ltd Quarterly Results

MonthDec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023
Sales41,93550,02853,46560,38760,78369,32463,43059,87857,08462,96259,49055,68255,312
Expenses32,36735,84437,35543,93144,88954,29448,45753,81753,03655,74254,58751,41449,048
Operating Profit9,56814,18416,11116,45615,89415,03014,9736,0604,0487,2194,9034,2686,264
OPM %23%28%30%27%26%22%24%10%7%11%8%8%11%
Other Income152-569102972481773884124912771,190-6,568-33
Interest1,7861,8661,8111,0201,5321,0991,2181,5191,7681,7941,8251,9591,881
Depreciation2,3422,3922,3252,2892,2442,2432,2372,3482,3682,3822,4122,4802,422
Profit before tax5,5939,35712,07714,12012,16611,86511,9062,6054033,3211,855-6,7391,928
Tax %28%23%19%11%21%17%35%50%721%53%72%3%73%
Net Profit4,0117,1629,76812,5489,5989,8357,7141,297-2,5021,566525-6,511522
EPS in Rs3.285.557.419.917.847.996.361.24-1.821.390.52-5.070.42

Last Updated: July 10, 2024, 5:03 pm

Tata Steel Ltd Quarterly Chart

Tata Steel Ltd Profit & Loss

Last Updated: July 10, 2024, 5:03 pm

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023TTM
Sales132,900134,712148,614139,504101,965112,299123,249157,669139,817156,294243,959243,353233,445
Expenses120,483130,746132,430136,095102,59099,156101,816128,351122,354125,790180,469211,053210,792
Operating Profit12,4173,96516,1843,409-62513,14421,43329,31817,46330,50463,49032,30022,653
OPM %9%3%11%2%-1%12%17%19%12%20%26%13%10%
Other Income4,9351,4457165,99410,346-3,78910,8981,524-2,8841801,3001,569-5,133
Interest4,2503,9684,3374,8484,2215,0725,4557,6607,5337,6075,4626,2997,459
Depreciation4,5175,5755,8415,9445,3065,6735,7427,3428,4419,2349,1019,3359,696
Profit before tax8,585-4,1336,722-1,388193-1,39121,13515,841-1,39513,84450,22718,235365
Tax %42%-78%45%-185%358%-200%16%42%184%41%17%56%
Net Profit5,217-7,2723,665-3,939-497-4,16917,7439,1221,1748,19041,7498,075-3,898
EPS in Rs4.78-6.263.19-3.48-0.34-3.7611.939.071.386.2632.887.17-2.74
Dividend Payout %22%-11%27%-20%-203%-23%9%15%74%40%16%50%

Tata Steel Ltd Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2012-20132013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-2023
YoY Net Profit Growth (%)-239.39%150.40%-207.48%87.38%-738.83%525.59%-48.59%-87.13%597.61%409.76%-80.66%
Change in YoY Net Profit Growth (%)0.00%389.79%-357.87%294.86%-826.22%1264.43%-574.18%-38.54%684.75%-187.86%-490.41%

Tata Steel Ltd Growth

Compounded Sales Growth
10 Years:4%
5 Years:8%
3 Years:14%
TTM:-6%
Compounded Profit Growth
10 Years:6%
5 Years:-6%
3 Years:-7%
TTM:-19%
Stock Price CAGR
10 Years:12%
5 Years:29%
3 Years:10%
1 Year:42%
Return on Equity
10 Years:10%
5 Years:14%
3 Years:18%
Last Year:7%

Last Updated: July 18, 2024, 5:40 pm

Tata Steel Ltd Balance Sheet

Last Updated: July 10, 2024, 5:03 pm

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Sep 2023
Equity Capital9719719719719709701,1451,1451,1451,1981,2211,2211,221
Reserves41,64533,20139,56130,37842,76236,84959,72667,78072,43173,041113,222101,86187,976
Preference Capital22212000020130000
Borrowings59,89768,50781,60980,70181,98783,01492,127100,803116,32888,50175,56184,89389,723
Other Liabilities44,27844,19749,46347,05951,16551,61455,72463,04559,24581,16992,41797,42192,894
Total Liabilities146,791146,876171,604159,109176,884172,447208,722232,773249,149243,909282,422285,396271,814
Fixed Assets59,28768,00274,90768,10072,20092,00796,105124,442134,551135,775133,288146,621141,929
CWIP20,19614,27726,82228,67835,99615,78416,61418,64119,49719,00722,04631,21335,761
Investments4,0213,2585,0933,45510,71412,45717,8995,7386,28510,68213,1408,4107,693
Other Assets63,28661,34064,78158,87657,97452,20078,10383,95288,81678,445113,94899,15186,432
Total Assets146,791146,876171,604159,109176,884172,447208,722232,773249,149243,909282,422285,396271,814

Tata Steel Ltd Reserves and Borrowings Chart

Tata Steel Ltd Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity 14,03513,14611,88011,45510,8248,02325,33620,16944,32744,38121,68320,301
Cash from Investing Activity -13,099-15,378-9,021-8,794-9,490-11,730-29,176-14,012-9,437-10,905-18,179-14,253
Cash from Financing Activity -1,7801,015-2,617-4,729-2,5796,640-673-1,695-37,090-23,401-6,981-11,097
Net Cash Flow-844-1,218241-2,068-1,2452,933-4,5134,462-2,20010,075-3,477-5,049

Tata Steel Ltd Free Cash Flow

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Free Cash Flow12.00-65.00-65.00-77.00-706.00-70.00-71.00-71.00-99.00-58.00-12.00-52.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Tata Steel Ltd Free Cash Flow Chart

Tata Steel Ltd Financial Efficiency Indicators

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Debtor Days413839354338372721221812
Inventory Days142145156165180230224190197213213175
Days Payable137117133126167172161130136166161122
Cash Conversion Cycle466762745696998782697166
Working Capital Days55-319102716712-3340
ROCE %9%-1%10%1%1%6%12%14%6%12%31%13%

Tata Steel Ltd Financial Efficiency Indicators Chart

Tata Steel Ltd Share Holding Pattern

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Promoters34.41%34.41%33.92%33.92%33.92%33.92%33.90%33.90%33.90%33.90%33.70%33.19%
FIIs21.94%22.38%21.36%22.87%21.95%21.52%21.87%20.62%20.28%20.31%20.01%19.61%
DIIs19.28%18.28%18.11%20.41%19.01%18.17%19.62%20.68%20.96%22.20%23.15%23.51%
Government0.10%0.10%0.10%0.10%0.10%0.16%0.16%0.16%0.16%0.16%0.16%0.16%
Public24.27%24.83%26.51%22.70%25.02%26.23%24.45%24.63%24.70%23.43%22.99%23.52%
No. of Shareholders10,22,48212,30,36716,91,27815,87,31520,47,66133,71,41733,35,26536,44,09036,92,75038,04,72839,92,60947,17,442

Tata Steel Ltd Shareholding Pattern Chart

No. of Tata Steel Ltd Shareholders

Tata Steel Ltd Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
SBI Nifty 50 ETF147,985,4721.172011.8628,737,8422024-07-20414.95%
SBI S&P BSE Sensex ETF103,303,0581.341403.8928,737,8422024-07-20259.47%
SBI Balanced Advantage Fund45,456,7302.25617.9828,737,8422024-07-2058.18%
UTI Nifty 50 ETF40,980,2541.17557.1328,737,8422024-07-2042.6%
Mirae Asset Large & Midcap Fund35,790,8901.46486.5828,737,8422024-07-2024.54%
UTI S&P BSE Sensex ETF35,632,2581.34484.2428,737,8422024-07-2023.99%
SBI Contra Fund33,345,5251.92453.3328,737,8422024-07-2016.03%
ICICI Prudential India Opportunities Fund31,962,5092.7434.5328,737,8422024-07-2011.22%
ICICI Prudential Balanced Advantage Fund28,737,8420.72390.6928,737,8422024-07-200%
Mirae Asset Large Cap Fund25,125,7810.9341.5928,737,8422024-07-20-12.57%

Tata Steel Ltd ROCE Trend

Tata Steel Ltd EPS Trend

Tata Steel Ltd Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue1.001.0010.0010.0010.00
Basic EPS (Rs.)-3.627.17332.3563.7811.86
Diluted EPS (Rs.)-3.627.17332.0963.7811.86
Cash EPS (Rs.)4.0313.91411.08142.7584.65
Book Value[Excl.RevalReserv]/Share (Rs.)74.1086.12958.87640.69645.34
Book Value[Incl.RevalReserv]/Share (Rs.)74.1086.12958.87640.69645.34
Revenue From Operations / Share (Rs.)183.71199.271997.681306.581301.12
PBDIT / Share (Rs.)19.3327.30526.32262.19171.62
PBIT / Share (Rs.)11.4119.65451.80185.0995.57
PBT / Share (Rs.)-0.8714.59405.97112.86-13.70
Net Profit / Share (Rs.)-3.896.27336.5565.658.60
NP After MI And SOA / Share (Rs.)-3.567.17328.8062.5413.59
PBDIT Margin (%)10.5213.6926.3420.0613.19
PBIT Margin (%)6.219.8622.6114.167.34
PBT Margin (%)-0.477.3220.328.63-1.05
Net Profit Margin (%)-2.113.1416.845.020.66
NP After MI And SOA Margin (%)-1.933.5916.454.781.04
Return on Networth / Equity (%)-4.828.4935.0810.192.18
Return on Capital Employeed (%)8.1312.5828.3112.695.79
Return On Assets (%)-1.623.0414.063.050.62
Long Term Debt / Equity (X)0.600.490.390.891.32
Total Debt / Equity (X)0.940.750.601.101.59
Asset Turnover Ratio (%)0.810.840.910.390.31
Current Ratio (X)0.710.891.020.840.95
Quick Ratio (X)0.210.330.480.380.44
Inventory Turnover Ratio (X)1.591.971.850.940.82
Dividend Payout Ratio (NP) (%)0.0071.087.4815.2895.60
Dividend Payout Ratio (CP) (%)0.0034.416.096.8414.49
Earning Retention Ratio (%)0.0028.9292.5284.724.40
Cash Earning Retention Ratio (%)0.0065.5993.9193.1685.51
Interest Coverage Ratio (X)3.215.2911.774.132.59
Interest Coverage Ratio (Post Tax) (X)1.392.208.552.171.78
Enterprise Value (Cr.)273277.28194373.13215203.42175394.42138706.36
EV / Net Operating Revenue (X)1.190.790.881.120.93
EV / EBITDA (X)11.335.833.355.597.06
MarketCap / Net Operating Revenue (X)0.840.520.650.620.20
Retention Ratios (%)0.0028.9192.5184.714.39
Price / BV (X)2.111.241.391.320.43
Price / Net Operating Revenue (X)0.840.520.650.620.20
EarningsYield-0.020.060.250.070.05

Tata Steel Ltd Profitability Ratios (%)

Tata Steel Ltd Liquidity Ratios

Tata Steel Ltd Liquidity Ratios (%)

Tata Steel Ltd Interest Coverage Ratios (%)

Tata Steel Ltd Valuation Ratios

Fair Value

Fair Value: 152.07

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

Overvalued: 3.75% compared to the current price 158

Intrinsic Value: 109.70

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators along with EPS growth.

Overvalued: 30.57% compared to the current price 158

Last 5 Year EPS CAGR: -27.87%

*Investments are subject to market risks

Strength and Weakness of Tata Steel Ltd Stock

StrengthWeakness
  1. The stock has a low average Working Capital Days of 5.75, which is a positive sign.
  2. The company has shown consistent growth in sales (158.46 cr) and profit (52.46 cr) over the years.
  1. The stock has a low average ROCE of 9.50%, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 72.92, which may not be favorable.
  3. The company has higher borrowings (86,765.67) compared to reserves (63,466.67), which may suggest financial risk.

Should I Buy Tata Steel Ltd Share Now?

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in Tata Steel Ltd:
    1. Net Profit Margin: -2.11%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 8.13% (Industry Average ROCE: %)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: -4.82% (Industry Average ROE: %)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 1.39
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 0.21
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 30.8 (Industry average Stock P/E: )
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.94
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Tata Steel Ltd

Tata Steel Ltd. is a Public Limited Listed company incorporated on 26/08/1907 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L27100MH1907PLC000260 and registration number is 000260. Currently Company is involved in the business activities of Manufacture of basic iron and steel. Company’s Total Operating Revenue is Rs. 129021.35 Cr. and Equity Capital is Rs. 1222.37 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
SteelBombay House, 24, Homi Mody Street, Mumbai Maharashtra 400001cosec@tatasteel.com
http://www.tatasteel.com
Management
NamePosition Held
Mr. Ratan N TataChairman Emeritus
Mr. N ChandrasekaranChairman & Non-Exe.Director
Mr. Noel Naval TataNon Executive Vice Chairman
Mr. T V NarendranManaging Director & CEO
Mr. Koushik ChatterjeeExecutive Director & CFO
Mr. Saurabh AgrawalNon Executive Director
Mr. V K SharmaIndependent Director
Ms. Bharti Gupta RamolaIndependent Director
Mr. Farida KhambataIndependent Director
Mr. Deepak KapoorIndependent Director
Mr. Shekhar MandeIndependent Director

FAQ

What is the latest fair value of Tata Steel Ltd?

The latest fair value of Tata Steel Ltd is ₹152.07.

What is the Market Cap of Tata Steel Ltd?

The Market Cap of Tata Steel Ltd is 1,96,953 Cr..

What is the current Stock Price of Tata Steel Ltd as on 21 July 2024?

The current stock price of Tata Steel Ltd as on 21 July 2024 is 158.

What is the High / Low of Tata Steel Ltd stocks in FY 2024?

In FY 2024, the High / Low of Tata Steel Ltd stocks is 185/114.

What is the Stock P/E of Tata Steel Ltd?

The Stock P/E of Tata Steel Ltd is 30.8.

What is the Book Value of Tata Steel Ltd?

The Book Value of Tata Steel Ltd is 73.7.

What is the Dividend Yield of Tata Steel Ltd?

The Dividend Yield of Tata Steel Ltd is 2.28 %.

What is the ROCE of Tata Steel Ltd?

The ROCE of Tata Steel Ltd is 7.02 %.

What is the ROE of Tata Steel Ltd?

The ROE of Tata Steel Ltd is 6.55 %.

What is the Face Value of Tata Steel Ltd?

The Face Value of Tata Steel Ltd is 1.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in Tata Steel Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE