Tata Steel Limited Fundamental Analysis
Tata Steel Limited (TATASTEEL.NS) shows weak financial fundamentals with a PE ratio of 22.65, profit margin of 4.66%, and ROE of 11.37%. The company generates $2318.8B in annual revenue with N/A year-over-year growth of N/A.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 45.4/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze TATASTEEL.NS's fundamental strength across five key dimensions:
Efficiency Score
WeakTATASTEEL.NS struggles to generate sufficient returns from assets.
Valuation Score
ExcellentTATASTEEL.NS trades at attractive valuation levels.
Growth Score
ModerateTATASTEEL.NS shows steady but slowing expansion.
Financial Health Score
ModerateTATASTEEL.NS shows balanced financial health with some risks.
Profitability Score
WeakTATASTEEL.NS struggles to sustain strong margins.
Key Financial Metrics
Is TATASTEEL.NS Expensive or Cheap?
P/E Ratio
TATASTEEL.NS trades at 22.65 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, TATASTEEL.NS's PEG of 0.10 indicates potential undervaluation.
Price to Book
The market values Tata Steel Limited at 2.39 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 4.72 times EBITDA. This is generally considered low.
How Well Does TATASTEEL.NS Make Money?
Net Profit Margin
For every $100 in sales, Tata Steel Limited keeps $4.66 as profit after all expenses.
Operating Margin
Core operations generate 18.61 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $11.37 in profit for every $100 of shareholder equity.
ROA
Tata Steel Limited generates $3.58 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tata Steel Limited generates limited operating cash flow of $130.86B, signaling weaker underlying cash strength.
Free Cash Flow
Tata Steel Limited generates weak or negative free cash flow of $56.45B, restricting financial flexibility.
FCF Per Share
Each share generates $4.52 in free cash annually.
FCF Yield
TATASTEEL.NS converts 2.31% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.65
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.10
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.39
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.06
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.90
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.75
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.11
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.21
vs 25 benchmark
How TATASTEEL.NS Stacks Against Its Sector Peers
| Metric | TATASTEEL.NS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.65 | 32.61 | Better (Cheaper) |
| ROE | 11.37% | 1178.00% | Weak |
| Net Margin | 4.66% | -145.00% (disorted) | Weak |
| Debt/Equity | 0.90 | 0.61 | Weak (High Leverage) |
| Current Ratio | 0.75 | 3.48 | Weak Liquidity |
| ROA | 3.58% | 624.00% | Weak |
TATASTEEL.NS outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tata Steel Limited's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
N/A
Industry Style: Cyclical, Commodity, Value
EPS CAGR
N/A
Industry Style: Cyclical, Commodity, Value
FCF CAGR
N/A
Industry Style: Cyclical, Commodity, Value