Tata Steel Offers 1:2 Bonus, 1:10 Split, Decades of Dividends; Analysts Set Highest Target Price at Rs 210

Tata Steel Offers 1:2 Bonus, 1:10 Split, Decades of Dividends; Analysts Set Highest Target Price at Rs 210

Tata Steel’s long record of shareholder rewards—1:2 bonus shares, a 1:10 stock split and nearly three decades of consistent dividends—is now being complemented by bullish analyst targets of up to ₹210, built on domestic capacity expansion, supportive steel pricing and a strong balance sheet. While the stock still trades below its 52‑week high, many brokerages maintain BUY ratings, arguing that the current price offers a reasonable entry into a structurally important steel franchise with steady cash returns and cyclical upside.​

Share Price, Valuation and Targets

As of early December 2025, Tata Steel trades around ₹165–170 per share, with a market cap above ₹2.08 lakh crore, roughly 3.5% higher year‑to‑date and about 36% above its 52‑week low of ₹122.6. The stock remains under ₹20 away from its 52‑week high near ₹187 and has seen periods of profit‑booking in line with swings in global steel and metal prices.​

Analyst targets cited in recent coverage cluster between ₹200 and ₹210, with Emkay Global recommending a BUY at ₹200 and ICICI Direct pegging its SOTP‑based target at ₹210 by assigning 8.5x EV/EBITDA to the India business and 4x EV/EBITDA to Europe on FY27 estimates. External forecast aggregators show a similar picture, with high‑end 12‑month targets around ₹200 and other models projecting a potential band of roughly ₹160–₹220 for 2025 depending on market conditions.​

Bonus, Split and Long Dividend History

Tata Steel has a well‑documented history of rewarding shareholders through corporate actions. The company issued a 1:2 bonus in August 2004, granting 1 bonus share for every 2 shares held, which increased the number of shares and reduced the per‑share price, enhancing liquidity without changing underlying value. In July 2022, it carried out a 1:10 stock split, reducing the face value from ₹10 to ₹1 per share and multiplying the number of shares ten‑fold, again mainly to improve affordability and trading volumes.​

Beyond these actions, Tata Steel has paid 28 dividends since June 2003, highlighting its status as a steady cash‑return stock in the cyclical metals space. Over the last few years it has consistently declared ₹3.60 per share as final dividend (360%) annually, and a spectacular ₹51 per share in FY22 when profits and cash flows were exceptionally strong, giving yields that often ranged between roughly 2–5% depending on the prevailing share price.​

Core Drivers Behind the Bullish Thesis

Brokerages remain constructive on Tata Steel because its Indian operations are entering a higher‑capacity, higher‑margin phase while policy and trade protections support domestic pricing. ICICI Direct, for instance, notes that the company’s India business will benefit from ongoing capacity expansion and the likely continuation of safeguard or import‑control measures, which can keep spreads healthy. The same report argues that EU import‑control frameworks should support European steel prices and help the Netherlands operations improve, even as Europe remains structurally more challenging than India.​

Strategically, Tata Steel has been simplifying its portfolio, focusing on India as the core earnings engine while taking steps to de‑risk its European footprint through cost cuts, restructuring and potential partnerships or exits. On the financial side, analysts point to deleveraging efforts in recent years, solid operating cash flows, and the ability to keep paying dividends while still funding capacity expansions—key reasons why the stock is often pitched as a “core metals holding” rather than just a trading bet.​

Risks: Cyclicality and Europe Overhang

Despite the attractive target prices and rewards track record, Tata Steel is still exposed to the inherent cyclicality of global steel and raw materials. Earnings remain sensitive to Chinese export behaviour, global demand in construction and autos, and price swings in coking coal and iron ore, which can compress margins if not offset by pricing power. The European business, though supported by import‑control measures, carries higher costs and environmental obligations, and any downturn there can dilute consolidated profitability and weigh on valuations.​

Valuation models that justify ₹200–₹210 targets assume stable to improving spreads, execution of capacity expansion on time and budget, and continued deleveraging; disappointments on any of these variables, or a sharp risk‑off phase in global commodities, could cap upside or even lead to meaningful corrections. For long‑term investors, the stock’s appeal lies in combining periodic corporate actions and dividends with leverage to steel upcycles, but position sizing and cycle awareness remain crucial.