Tata Group stock gets third bullish call in five days with Motilal Oswal projecting 19% upside

Brokerage firm Motilal Oswal has upgraded shares of Tata Steel Ltd

. on Tuesday, October 28, to "buy" from its earlier rating of "neutral".

The brokerage has also revised its price target higher for the Tata Group stock to ₹210 from ₹180 earlier, implying a potential upside of 19% from Monday's closing levels.

This is the third bullish recommendation that Tata Steel has received in the last five days. On October 23, brokerage firm Nomura had initiated coverage on the stock with a "buy" rating, while on Monday, InCred Equities had upgraded the stock to "add" from its earlier rating of "reduce", along with an upward revision in price target.

Motilal Oswal believes that Tata Steel's strong domestic outlook, coupled with a breakeven in the European business will drive the company's consolidated earnings. The company is also aggressively expanding its capacity in India to capitalize on the increasing domestic demand. Tata Steel is aiming for an overall capacity of 40 MTPA by financial year 2030 from the current 26.5 MTPA.

India's steel demand is expected to grow between 8% to 10% over financial year 2026-2027 backed by robust demand, policy support and an ongoing recovery in industry fundamentals, Motilal Oswal said, adding that domestic prices will be further supported due to the proposed 12% safeguard duty on flat steel products.

In Europe, Tata Steel is transitioning into a green steel manufacturer and operations in the continent are headed towards breakeven led by restructuring and cost optimization. Losses on the Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) front have narrowed from $76 per tonne to $8 per tonne in the first quarter led by operational efficiency and lower energy costs.

Motilal Oswal believes that a shutdown in the UK blast furnace and ramp-up of operations in the Netherlands, the European EBITDA for Tata Steel is set to improve further. It sees the EBITDA per tonne figure to reach $70 by financial year 2028, which should also trigger the consolidated EBITDA per tonne figure towards ₹13,000 by financial year 2028 from ₹8,376 currently.

"While near-term challenges persist due to global uncertainties around tariff escalations, the long-term outlook remains strong. The Indian business is expected to remain strong and an improvement in Europe will help earnings," the Motilal Oswal note said.

Out of the 36 analysts that track Tata Steel, 25 of them have a "buy" rating, seven say "hold", while four have a "sell" rating. However, a consensus estimate of price targets does not see any potential upside for the stock.

Shares of Tata Steel ended 1.2% higher on Monday at ₹176.6. The stock is up 4.5% in the last one month and 30% so far in 2025.