In the last few days, Tata Steel has seen a sharp correction. It is down approximately 11-12 percent.

Share Market Live

NSE

Fundamentally, nothing much has changed; there is some bit of correction in terms of prices, but that is more or less because of the monsoon season. So, the stock has basically taken a hit because of the risk-off trade that is seen in the last few days.

Also Read:

Explained: What is fossil fuel-free steel and how it protects environment

During Monday’s trading session, the stock went down to around Rs 1,311. So that will be a level to watch and if it can hold that level, then it's good for a bit of a bounce. On the upside, the 20-day moving average (DMA) comes in at around Rs 1,418. So, that level will have to be kept on the radar as well.

Fundamentally, things will look up in Q2 as well, as Q2 (FY22) is expected to be the star. Steel prices are up by Rs 3,000 per tonne when compared to Q1. European spreads will improve and debt reduction will continue.

Also Read: Tata Steel announces Rs 270 crore annual bonus for 2020-21

So fundamentally strong, the problem is the risk-off trade. Therefore, if the stock can sustain at higher levels then maybe it could move back toward Rs 1,500.

Watch the accompanying video of CNBC-TV18’s Nigel Dsouza for more details.

(Edited by : Dipika Ghosh)