Tata Chemicals Extends Winning Run After Parent Increases Stake

Shares in Tata Chemicals Ltd. rose on Thursday, set for another record high amid 11th day of gains, its longest winning streak in 18 years, after its parent Tata Sons increased stake in the company.

  • Tata Sons Private Ltd. bought about 1.80 million shares in the company at 420.92 rupees apiece in a block deal on Wednesday, according to NSE’s data
    • Tata Sons Private Ltd. held 29.39% stake in the company as on Sept. 30: Bloomberg data
  • Stock gains as much as 8.8% with volumes at about 3 times of 3-month average

Market Metrics

  • Trading volume was 4.81 million shares, 12 times the 20-day average of 410,162 shares for this time of day.
  • One-month implied volatility was 39%.
  • The relative strength index on the stock was above 70, indicating it may be overbought.
  • The stock is higher for the 10th straight day.
  • Of shares that were traded, 44% were at the ask price and 25% were at the bid.

Market Insights

  • Stock advanced 45% in the past 52 weeks. The Sensex gained 9.4%.
  • The shares are up 23% in the past 5 days and rose 46% in the past 30 days.
  • Tata Chemicals trades at 25 times its estimated earnings per share for the coming year. It trades at 1.7 times trailing EPS.
  • The company is priced at 0.9 times book value.
  • The company’s dividend yield is 2.4% on a trailing 12-month basis and 2.4% based on Bloomberg Dividend Forecasts for the next 12 months.

Analyst Activity

  • Analysts have five buy, three hold, and two sell recommendations on the stock.
  • The consensus rating is 3.5, on a 1-5 scale with 1 meaning strong sell and 5 meaning strong buy.
  • The price target of 343 rupees represents a 25% decrease from the last price
  • Analysts raised the target 11% in the past month and 29% in the past three months.

©2020 Bloomberg L.P.

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