Steel Authority of India (SAIL) share price rose 2% intraday on September 17th after upgrading Citi stock.
The global research firm has raised the target to Rs. 50 crores. According to a CNBC-TV18 report, good realizations, improving demand, and increasing volumes will benefit the company.
EBITDA from the company’s net debt is likely to improve in FY21 and Citi expects it to be profitable in FY22. The company raised its EBITDA estimates for SAIL by 64% in FY21, 16% in FY22, and 22% in FY23.
The stock is trading at Rs. 38.90, up to Rs. 3.85 or 2.23 per cent. It has an intraday high of Rs. 39.50 and the intraday low of Rs. 3.90.
The domestic steel major reported a net loss of Rs. 1,226.47 crores for the first quarter ended September 14th, mainly due to a decline in revenue. SAIL had told BSE a net profit of Rs. 102.68 crores in the previous quarter.
Net profit for the quarter fell to Rs. 9,346.21 crores from Rs. 14,998.20 crores in April-June last fiscal year. Its total revenue stood at Rs. 11,325.10 crores as compared to Rs. 14,893.07 crores a year ago.
Morgan Stanley continued his ‘lightweight’ call on the stock, with a target of Rs. 43 per share. He opined that lower coking coal prices would reduce the cost of production and could benefit from operating leverage of Rs. 4,000 – 5,000 per tonne.
EBITDA is expected to improve to Rs. 8,000 – 9,000 per tonne if prices remain stable.
The Stockinvestor technical rating is neutral as moving averages are neutral and technical indicators are bearish.