Target Price: ₹195
Current Market Price (CMP): ₹171.90
Tata Steel reaffirmed its long-term growth strategy for its India business during a board meeting on December 10. The company announced a series of significant initiatives aimed at expanding its production capabilities and enhancing its market position.
The board granted approval for the much-anticipated expansion of its NINL long products facility, increasing capacity by 4.8 million tonnes per annum (mtpa), raising the total from 1.1 mtpa to 5.9 mtpa. This expansion is expected to provide long-term growth visibility beyond 2030. Additionally, Tata Steel has approved the construction of a 2.5 mtpa Thin Slab Caster and Rolling facilities at its Meramandal site to bolster its finished steel capacity in flat products.
In further developments, the company plans to establish a 0.7 mtpa Hot Rolled Pickling and Galvanising Line (HRPGL) at its existing Cold Rolling Complex in Tarapur, Maharashtra, aimed at strengthening its automotive segment through import substitution. Tata Steel has also signed a Memorandum of Understanding (MoU) with Lloyd Metals & Energy (LMEL) to produce iron ore and to develop a 6 mtpa greenfield steel plant in two phases, while assisting LMEL with ongoing steel plant expansions.
Furthermore, Tata Steel finalized agreements to acquire a 50.01 percent stake in Thriveni Pellets Private Ltd (TPPL), pending regulatory approvals. TPPL holds a 100 percent stake in Brahmani River Pellet Ltd (BRPL), which operates a 4 mtpa pellet plant in Jajpur, Odisha, alongside a 212-km slurry pipeline. LMEL retains the remaining 49.99 percent stake in TPPL. The company also approved engineering work for a 1 mtpa Hisarna demonstration plant in Jamshedpur, scaling its proprietary low-carbon technology, previously tested over a decade at the Ijmuiden plant.
The company’s valuation and recommendations remain unchanged from previous assessments. Using a Sum-of-the-Parts (SoTP) approach, Tata Steel assigns a one-year forward EV/EBITDA multiple of 7.5x for its India operations, 5.0x for other operations, and 4.0x for its European segment, based on September 2027 EBITDA. This methodology leads to a target price of ₹195 per share for September 2026, which reflects a potential 17 percent upside from the current market price. Consequently, the company maintains a BUY rating on the stock.
Published on December 12, 2025
