Tata Steel shocks the Street with quarterly loss; what should investors do?

Tata Steel shares suffered losses on Tuesday, a day after the Tata group steel giant reported a net loss of Rs 2,224 crore for the quarter ended December 2022 amid a fall in realisations across geographies. The quarterly net loss came in stark contrast to analysts' expectation of profit. 

The Tata Steel stock fell by Rs 6.9 or 5.8 per cent to Rs 110.8 on BSE in intraday trade. 

The Mumbai-based steelmaker had reported a net profit of Rs 9,573 crore for the quarter ended December 2021.

Tata Steel Q3 results 

After market hours on Monday, Tata Steel reported revenue of Rs 57,083 crore for the three-month period, down six per cent compared with the corresponding period a year ago.

The company's margin — a key measure of profitability for companies — dropped to seven per cent from 26 per cent in the year-ago period. 

Tata Steel's adjusted EBITDA per tonne — which determines the money a producer earns from every tonne of output — slumped to Rs 3,812 from Rs 22,663 a year ago. 

According to Zee Business research, the company's quarterly net profit was estimated at Rs 1,012 crore, revenue at Rs 52,966 crore and margin at 10 per cent.

What brokerages recommend on Tata Steel after steelmaker's Q3 results

According to CLSA, Tata Steel's consolidated EBITDA was largely in line with the brokerage's estimate but adjusted EBITDA as well as adjusted standalone EBITDA per tonne were much lower.  

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