Whalesbook
Indian Operations Lead Growth
Tata Steel's Indian business delivered a strong operational performance for the December quarter, significantly boosting its overall results. Crude steel production surged 11.4% year-on-year to 6.34 million tonnes during Q3FY26. Delivery volumes saw an even sharper increase, climbing 14% to 6.04 million tonnes from the previous year's corresponding period.
European Business Faces Challenges
In stark contrast, Tata Steel's European operations presented a mixed and largely challenging picture. Tata Steel Netherlands reported a 4.5% dip in production, reaching 1.68 million tonnes, with sales volumes falling by 8.5% to 1.4 million tonnes. Further compounding these issues, Tata Steel UK saw its delivery volumes decline by 9% to 0.52 million tonnes, with production remaining at nil as both blast furnaces have been idled.
Tata Steel Thailand offered a more positive regional performance, with production rising 19% year-on-year to 0.31 million tonnes and delivery volumes increasing 3.6% to 0.29 million tonnes.
Brokerages Weigh In on Tata Steel
Financial institutions maintain a generally positive outlook on Tata Steel. HSBC reaffirmed its 'Buy' rating, setting a price target of ₹215. The brokerage highlighted that European steel companies have seen significant rallies driven by the impending Carbon Border Adjustment Mechanism (CBAM), expecting further price increases. HSBC expressed surprise at Tata Steel's European underperformance, given its substantial footprint in the region.
Morgan Stanley echoed this sentiment, maintaining an 'Overweight' rating with a price target of ₹200. The firm pointed to the sustained momentum in the Indian business as a key positive, even as volumes in the Netherlands and UK faced sequential pressure.
Market Reacts to Mixed Results
Despite the underlying operational strengths in India and positive analyst outlooks, Tata Steel shares closed 1.42% lower on Wednesday, settling at ₹183.55.