Tata Steel reels under pressure ahead of Q3 results today; here's what to expect

Tata Steel shares succumbed to the red zone on Monday as investors awaited the steelmaker's financial results for the October-December period due later in the day.

Tata Steel is due to report its financial results on Monday, February 6. | Image: Reuters

Tata Steel shares fell on Monday ahead of the Tata group steelmaker's financial results due later in the day. The Tata Steel stock declined by as much as Rs 2.8 or 2.3 per cent to Rs 117.3 apiece on BSE.

According to Zee Business research, Mumbai-based Tata Steel's net profit for the October-December period is estimated at Rs 1,012 crore, which translates to a fall of 89 per cent compared with the corresponding period a year ago.

The analysts estimate the steel major's to decline 13 per cent on a year-on-year basis to Rs 52,966 crore owing to lower realisations and weakness in the steelmaker's European business. They see Tata Steel's earnings before interest, taxes, depreciation and ammortisation (EBITDA) dropping 67 per cent to Rs 5,282 crore compared with the year-ago period.

According to Zee Business research, Tata Steel's margin — a key measure of profitability for a business — is likely to slump by 1,600 basis points to 10 per cent on a year-on-year basis.

They peg its EBITDA per tonne — a key metric for material producers — at $150 for the quarter ended December 2022, as against $303 for the year-ago period.

The Tata Steel stock has moved between Rs 113.8 and Rs 124.3 apiece so far in 2023. Tata Steel shares gained 13.4 per cent in value in the quarter ended December 2022, a period in which headline indices Sensex and Nifty50 rose 5.9 per cent each.

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