Tata Steel: Debt Beneath the Wings
- Warut Promboon/Sentianung Longkumer
- Mar 16, 2018
- 1 min read
We initiate our coverage on Tata Steel Ltd (TATA IN) (“TSL”) with an UNDERWEIGHT recommendation on all of the TATAIN complex as we believe the complex is fully-valued against its domestic peers (See the Valuation section). We also expect the company’s leverage to increase materially (see the debt section). Among India’s steel producers, we see a better value proposition in the JSTLIN complex (JSW Steel) and expect TATAIN yield to increase in the near term on debt overhang (though we do not expect a rating downgrade).
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