With a price target of Rs 210, the brokerage forecasts an upside potential of 19% from the last close of Rs 177 per share on the NSE. “Tata Steel is one of the largest players in India’s steel sector and is set to benefit from improving steel price realizations, operating efficiencies, and the strong domestic demand outlook. The implementation of the safeguard duty is expected to help domestic operations achieve better realization,” Motilal Oswal said in a note dated October 27.
Analysts acknowledged that near-term challenges persist due to global uncertainty around tariff escalations, the long-term outlook for the company remains strong. The Indian business is expected to continue its strong performance, and an improvement in the European business performance is likely to support overall earnings.
India’s steel demand is expected to grow by around 8–10% over FY26–27, driven by a robust demand environment, supportive government policies, and improving industry fundamentals.
To curb rising imports and protect domestic players, the government has proposed a 12% safeguard duty on flat steel products, which is likely to help stabilize and support local prices. For the second half of FY26, market sentiment remains positive, with expectations of a gradual recovery in steel prices, muted input costs—particularly lower coking coal prices—and continued demand tailwinds from infrastructure and manufacturing growth.
The brokerage also added that capacity expansion will drive earnings and demand upswing as the company is aggressively expanding in India to capitalize on rising domestic demand, targeting an increase from 26.5mtpa in FY25 to 40mtpa by FY30.The company has commissioned a 5mtpa integrated capacity at Kalinganagar, increasing the plant’s total capacity to 8mtpa (INR270b investment), with phase-III expansion targeting 13mtpa. Other key projects include scaling NINL from 1mtpa to 4.5mtpa, a 0.75mtpa electric arc furnace (EAF) at Ludhiana by FY27, and expanding Meramandali from 5.6mtpa to 8.2mtpa.In Europe, the company is transitioning to green steelmaking, converting Port Talbot (UK) to a 3mtpa EAF and exploring a gas-based DRI + EAF route at IJmuiden (Netherlands), subject to policy clarity.
Tata Steel has seen robust brokerage interest off late. Last week, Nomura initiated coverage with a Buy call, citing five key growth drivers: domestic demand strength, rising utilization at Kalinganagar, turnaround prospects in Europe, sustained cost advantages from captive mines, and attractive valuations. Yesterday, InCred Equities upgraded the stock to Add from its earlier rating of Reduce, along with an upward revision in price target to Rs 224.
Tata Steel shares are up 30% on a year-to-date basis. Shares of the company ended the previous session at Rs 177 per share, higher by 1.24% from the last close on the NSE.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)