360% Dividend: Buy Tata Metal Stock For TP Rs 200, Tax Update On Dividend Issued

Tata Group company Tata Steel witnessed a decline of 64.1% Year-on-Year (YoY) in consolidated net profit at Rs 611.48 crore for the Q4 ended March 31, 2024 amid restructuring cost pertaining to UK and lower steel realization. Its net profit in the corresponding period of last year was 1704.86 crore. The metal giant recommended a dividend of Rs 3.60 per ordinary (Equity) share of the face value of Re 1/- each. Current market price of Tata Steel share on BSE is Rs 167.15 per share.

Tata Steel shares declined 4.38% in last 1-week and offered return of 57.91% in last 1-year. It is worth noting that Life Insurance Corporation of India (LIC) has 7.29% stake in Tata Steel with 90,97,67,778 shares of the company. Tata Steel has a market capitalisation of Rs 2,08,660.74 crore.

Tata Steel Recommends Dividend: As per the BSE filing of the company issued as on May 26, "Recommended a dividend of Rs 3.60 per Ordinary (Equity) Share of face value Re 1/- each (360%) to the shareholders of the Company for FY2023-24. The dividend recommended by the Board of Directors of the Company is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company scheduled to be held on Monday, July 15, 2024."

Tata Steel Sets Record Date For Dividend: The BSE filing added, "Pursuant to Regulation 42 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has fixed Friday, June 21, 2024, as the Record Date for determining the Members entitled to receive the dividend for the financial year ended March 31, 2024."

Issue Of NCDs: The company on May 26 reviewed the financing plan of the Company and based on the review, approved issue of additional debt securities, in one or more tranches, up to Rs 3,000 crore in the form of NCDs on private placement basis (Issue). Further, the Board of Directors has authorized a Committee of Directors to determine and approve the quantum, timing and terms and conditions of the issue of the NCDs.

Tata steel also approved the proposal to infuse funds up to USD 2.11 Billion (~Rs 17,407.50 crore), by way of subscription to equity shares of T Steel Holdings Pte. Ltd (TSHP), wholly owned foreign subsidiary of the Company, in one or more tranches, during FY2024-25. It also approved the proposal to convert debt instruments aggregating to USD 565 Million (~Rs 4,661.25 crore) held by the Company in TSHP into equity shares, during FY2024-25. The Company will continue to hold these converted equity shares.

Tata Steel Q4: The consolidated revenue from operations of Tata Steel declared at Rs 58,687.31 crore, down 6.8% Y-o-Y. Sequentially, the company's revenue surged 6.1% and net profit rose 19.1%. For FY24, the consolidated revenue declared at Rs 2,29,170.78 crore as against Rs 2,43,352.69 crore declared in FY23.

Tata Steel Share Performance & Return: The 52-week high price of Tata Steel shares on BSE is Rs 178.00 per share (as on 27/05/2024) and 52-week low price is Rs 105.80 per share (as on 01/06/2023), respectively. The ROE of Tata Steel is quoted at 3.48, PE at 46.56, and EPS (TTM) at 3.59. Tata Steel shares surged 19% year-to-date, gained 31% in last 6-months, rose 58% in last 2-years, and rallied 242% in last 5-years.

Tata Steel Issues Tax Deduction Update On Dividend: As per the regulatory filing dated May 31, "Pursuant to the provisions of the Income Tax Act, 1961 and the Rules framed thereunder, as amended by the Finance Act, 2020, dividend paid or distributed on or after April 1, 2020, shall be taxable at the hands of the Shareholders." More details here: https://www.bseindia.com/xml-data/corpfiling/AttachLive/2193c043-e62c-423c-9b7c-118c1ad64405.pdf

Tata Dividend History: Tata Steel declared its highest ever dividend of Rs 51/share in 2022. It declared 30 dividends since May 24, 2001. In the last 1-year, Tata Steel announced an equity dividend amounting to Rs 3.60 per share. At the current market price of Rs 167.15, Tata Steel offers an attractive dividend yield of 2.15%, according to Trendlyne.

Tata Steel Shareholding For March 2024 Quarter: Number of FII/FPI investors increased from 1036 to 1043 in Mar 2024 quarter. Mutual Funds have increased holdings from 9.83% to 10.10% in Mar 2024 quarter. Number of MF schemes increased from 59 to 65 in Mar 2024 quarter, according to Trendlyne.

Tata Steel Bonus Share History: Tata Steel declared 1 bonus share since August 11, 2004. The metal stocks' last bonus was announced in the ratio 1:2 and ex-bonus date was set as August 11, 2004.

Tata Steel Stock Split History: It sub-divided/split the face value of its share once since July 28, 2022. Tata Steel split the face value of its shares from Rs 10 to Re 1 in 2022. Tata Steel share traded ex-split as on July 28, 2022.

Should You Buy Tata Steel Share? Jefferies has buy call on Tata Steel share with target price of Rs 200 per share. JM Financial has also assigned buy call on Tata Steel stock with target price of Rs 180 per share.

Earlier, ICICI Securities expected domestic steel consumption to surge 2x to 210 mt (FY23 baseline) by FY32E. Among the leading steel firms, ICICI Securities believed JSW Steel and Tata Steel to reach 50 mtpa and 40 mtpa of domestic capacity, each by FY30E. The brokerage house anticipated Tata Steel shares hitting the levels of Rs 200 soon. The earlier target price for Tata Steel shares was set Rs 150.

Disclaimer: The stock has been picked from the brokerage report of ICICI Securities, Jefferies, and JM Financial. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.