Shares of Tata Chemicals Ltd slipped 0.56 per cent to close at Rs 1,001.85 on Monday. At Monday’s closing level, the stock traded 17.52 per cent lower than its 52-week high of Rs 1,214.65, touched on 11 October last year. On a year-to-date (YTD) basis, the scrip has climbed 6.48 per cent.
Geojit Financial Services has maintained a ‘Buy’ call on the counter with a target price of Rs 1,197 due to a ‘positive’ outlook.
“The company posted decent earnings on account of stable demand, better realisations and cost management. The management expects soda ash demand to rise, with supply tightening in the upcoming quarters leading to better realisations. Hence, we reiterate our ‘Buy’ rating on the stock with a revised target price of Rs 1,197,” Geojit stated.
The brokerage noted that in Q3 FY23 (December 2022), the company’s consolidated revenue was up 32 per cent YoY (year-on-year) to Rs 4,148 crore, led by better soda ash realisations across all geographies and stable demand.
“EBITDA was up 69.10 per cent YoY to Rs 922 crore aided by better cost management. Profit after tax increased 25.70 per cent YoY to Rs 391 crore,” it added.
Geojit also mentioned that Tata Chemicals expects demand for soda ash to rise, helped by China’s reopening and the emergence of newer glass applications.
“Despite recessionary pressure in multiple geographies, the company’s orders are fully booked and expects a strong market for its products,” it further stated.
Kotak Institutional Equities has also assigned a ‘Buy’ rating while pegging the counter at a fair value of Rs 1,210.
Tata Chemicals has an average target price of Rs 1,173.33, Trendlyne data showed, suggesting a potential upside of 17.09 per cent. The scrip has a one-year beta of 1.01, indicating average volatility.
The stock traded higher than the 5-day, 20- and 50-day moving averages but lower than the 100-day and 200-day moving averages. The counter’s 14-day relative strength index (RSI) came at 53.86. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company’s stock has a price-to-equity (P/E) ratio of 23.70.
Meanwhile, Indian equity benchmarks would be closed today due to ‘Holi’.
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