Shares of Tata Steel hit an all-time high of Rs 924.25 as they rallied 6 per cent on the BSE in intra-day trade on Thursday. The stock surpassed its previous high of Rs 924 touched on October 29, 2007. In the past one month, the Tata group company has rallied 25 per cent after the global rating agencies upgraded the outlook on Tata Steel to stable, citing a recovery in Q3 of the financial year 2020-21 (Q3FY21).
On Tuesday, March 6, Standard and Poor’s raised the credit rating of Tata Steel and its subsidiary ABJA Investment Co from ‘B+’ to ‘BB-' on deleveraging and strong operating momentum. Tata Steel's debt level is expected to decline materially in the next two years due to a strong cash flow and the company's stated intention to reduce debt.
“In our base case, we expect Tata Steel's adjusted debt to decline by about 30 per cent by March 2023 from the March 2020 level of about Rs 1 trillion, leading its credit metrics to steadily improve. The stable outlook reflects our expectation that Tata Steel will adequately deleverage over the next two years and build comfortable headroom at the current rating level,“ it said in its rating action.