Shares of this Tata Group entity under the ‘large-cap’ category jumped around 3 percent in Tuesday’s trading session after receiving a rating upgrade from ‘Moody’s Investors Service’. The company’s shares have gained more than 25 percent in the past six months.
With a market capitalization of Rs 1.58 lakh crores, the stocks of Tata Steel Limited, a large-cap company under the Tata Group universe, started their trading session on Tuesday at Rs 129.70 and currently trade at Rs 129. The company’s scrip saw an intra-day high of Rs 130.55 representing a gain of approximately 3 percent as compared to the previous close of Rs 127.35 apiece.
Such bullish sentiments around the company’s stock was observed after a BSE filing published with the Bombay Stock Exchange (BSE) dated September 25th 2023 intimating about a revision in rating from Moody’s Investors Service.
The international credit rating agency, having a positive outlook, upgraded the corporate family rating of Tata Steel Limited from ‘Ba1’ (Positive) to ‘Baa3’ (Stable) thereby making an entry under the tag of ‘Investment Grade’ securities.
The upgrade in the rating is due to various factors comprising large scale cost-competitive steel operations in India, strong capex plans, setting up new plants abroad, etc. Moreover, Tata Steel, having a wide range of operations in India, the second largest steel market globally, boosts the company’s credit profile.
Digging into the financials reported during the recent quarters, the company has underperformed that is supported by declining operating revenues as well as net profits.
The operating revenues went down from Rs 62,961.54 crores during Q4FY22-23 to Rs 59,489.66 crores during Q1FY23-24, and, the net profits, in congruence, reduced from Rs 1,469.99 crores to Rs 796.13 crores keeping the timeframe the same.
The latest shareholding pattern data, as per the June 2023 quarter, portray the company’s Promoters holding a 33.9 percent stake, and the Foreign Institutional Investors (FIIs) holding a considerable stake of 20.28 percent in the company.
Tata Steel Limited is a company based in India that is associated with the production & marketing of various steel products. The company’s products are generally classified into ‘construction’ products and ‘flat’ products. Its segments include Tata Steel India, Tata Steel Long Products, and many other operating divisions overseas.
Written by Amit Madnani
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