Archive · 13 Nov 2025
Tata Steel Q2 FY26 Earnings Beat Estimates, Brokerages Recommend Mixed Views
Tata Steel had a really good quarter from July to September 2025, making a lot more profit than the year before.
Their sales also went up.
Several big financial analysts looked at this and shared their thoughts.
Some think the company's stock is a good buy and will go up in price because of strong sales in India and better ways of managing costs.
They believe things like government duties on imported steel will help.
However, other analysts are more cautious and think the stock might not go up as much.
They see the earnings as being about what they expected and have a neutral outlook.
The company is also working to save money and increase its production capacity, which are positive signs.
Tata Steel's net profit in Q2 FY26 surged by 272% year-on-year to ₹3,102 crore.
Consolidated revenue for the quarter increased by 9% to ₹58,689 crore.
Consolidated EBITDA saw a rise of over 46% year-on-year to ₹9,106 crore.
Brokerages like Motilal Oswal, Morgan Stanley, and Jefferies have issued 'Buy' or 'Overweight' ratings with price targets between Rs 200 and Rs 210.
CLSA maintains a 'Hold' rating with a price target of Rs 170, citing mixed performance drivers.
- Who
- Tata Steel Ltd and various brokerage firms (Motilal Oswal, Morgan Stanley, Jefferies, CLSA)
- What
- Reported a significant rise in Q2 FY26 net profit and revenue, beating analyst estimates, with brokerage firms issuing mixed ratings and price targets.
- When
- Quarter ended September 30, 2025 (Q2 FY26)
- Where
- India, Netherlands, UK (operations mentioned)
- Why
- Profitability boosted by improved steel price realizations, operating efficiencies, strong domestic demand, capacity expansion, and cost control initiatives. Brokerage views influenced by stock valuation, earnings performance, and future outlook.
Positive Outlook & Buy Recommendations
Cautious Outlook & Hold Recommendations
Financial Performance & Estimates
Positive Outlook & Buy Recommendations
Several brokerages like Motilal Oswal (Buy, TP Rs 210), Morgan Stanley (Overweight, TP Rs 200), and Jefferies (Buy, TP Rs 200) highlight strong year-on-year profit growth and EBITDA figures that beat their estimates. They point to improved steel price realizations, operating efficiencies, strong domestic demand, and recent capacity expansions as key drivers.
Cautious Outlook & Hold Recommendations
CLSA maintains a 'Hold' rating with a price target of Rs 170, noting that while consolidated adjusted EBITDA was largely in line, lower realisations offset by lower costs were the primary drivers. They acknowledge volume growth but highlight a decline in EBITDA per tonne on a quarter-on-quarter basis for standalone operations.
Stock Valuation & Growth Potential
Positive Outlook & Buy Recommendations
Motilal Oswal sees an attractive upside of 19% and notes the stock is trading at 6.8x EV/EBITDA and 1.9x FY27E P/B, making it a compelling buy. The expected benefit from safeguard duties and strong domestic demand outlook supports their positive view.
Cautious Outlook & Hold Recommendations
While not explicitly stating a negative outlook, the 'Hold' rating from CLSA suggests a more neutral stance on the current stock price relative to its future prospects. The price target of Rs 170 is closer to the current trading price, indicating less immediate upside compared to the 'Buy' recommendations.
- Company
- Tata Steel Ltd
- Reporting Period
- September Quarter (Q2 FY26)
- Consolidated Net Profit (Q2 FY26)
- ₹3,102 crore
- Year-on-Year Profit Growth
- 272%
- Consolidated Revenue (Q2 FY26)
- ₹58,689 crore
- Consolidated EBITDA (Q2 FY26)
- ₹9,106 crore
- Standalone EBITDA (Q2 FY26)
- ₹8,150 crore
- Net Debt (Q2 FY26)
- ₹87,000 crore
Sources
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