Tata Steel shares have seen a big sell-off in 2022 as so far this year, Tata Steel’s share price has dropped from around Rp1142 to Rp885 each level, recording a decline of about 22 percent in this time frame. Stocks close today at Rp885.25 with a 1.64 percent decline gap and 11,200,063 shares traded on the day. ICICI Securities, a brokerage, has issued a buy call today for the stock with a target price of Rs. 1045, purchase range of Rs. 875-895, and a stop loss of Rs. 799. According to the broker, the share price increase will be achieved within 3 months of the target framework.

As per ICICI Securities, “Nifty has remained volatile since the start of the May series along with the broader market. From the metal space, Tata Steel witnessed a significant correction on the back of a sharp decline in metal prices amid fears of a global recession. However, after a nearly 45% correction from above we feel it is currently in a pullback mode as it comes back from its Put base. We believe the recent momentum seen in the stock will be followed by fresh buying in the sessions ahead.”

“Leveled positions in stocks have decreased markedly to date as stock prices remain on a downward trend. However, since the early July series, the stock has witnessed a long run of accumulation during which OI edged up. The stock has been able to trade above its resistance level Rp900, indicating further gains. The stock has witnessed accumulation near the support level Rp840-850. With continued Put posts at 800 and 860 strikes, we expect downside risks to be limited. On the other hand, Call OI 860 and 880 strikes have already seen position closings suggesting a positive bias in the stock. This position is expected to assist him in breaking into the range of options on the higher side,” the brokerage said in a note.

“Stock has seen one of its notable delivery-based actions Rp900 in the last few weeks. Since then, it has been crawling north with early signs of stocks making a base in the support area. The stock is trading near the long-term mean-2*sigma level. Currently, this level is placed near Rp810. We believe a continuation at current levels alone should give the stock momentum towards our target level Rp1045,” said research analyst ICICI Securities.

“In November 2020-August 2021, the stock has witnessed an impulsive upside move towards Rp1500. Since then, it has mostly seen a time- and price-based correction. The recent decline is headed RpThe 800-850 has provided another opportunity to buy shares,” said the brokerage.

Tata Steel is a high dividend yielding company and has shown a positive profit increase of over 76 percent CAGR over the last five years. With a book value per share of Rp. 958.50 for Tata Steel, these shares are now being sold at a low price to a book value (P/B) of 0.92 times the book value.

The views and recommendations made above are those of the respective analysts or brokerage firms, and not of Mint.


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