TATACHEM - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 3.6

📊 Fundamental Analysis

Tata Chemicals shows mixed signals for long-term investment

ROE (1.20%) & ROCE (3.96%): Weak return metrics, suggesting inefficient capital deployment.

Debt-to-Equity (0.33): Moderate leverage, manageable but not ideal.

Stock P/E (55.3) vs Industry P/E (27.2): Overvalued relative to peers.

PEG Ratio (-1.38): Negative PEG indicates earnings contraction or unreliable growth forecasts.

Dividend Yield (1.10%): Modest, not a strong income play.

Book Value (₹847) vs Current Price (₹1,000): P/B ratio ~1.18, which is fair but not compelling.

📈 Technical & Price Trend Insights

Current Price: ₹1,000

DMA 50 / DMA 200: ₹923 / ₹940 — price is above both, indicating short-term bullish momentum.

RSI (67.2): Approaching overbought zone.

MACD (11.5): Bullish crossover, but momentum may be peaking.

Volume Spike: 3x above weekly average — suggests speculative interest.

🧠 Long-Term Investment Outlook

While Tata Chemicals is a Tata Group company with legacy strength, its earnings volatility, low profitability, and high valuation make it a cautious long-term pick.

Forecasted Price Targets

2025: ₹1,056–₹1,098

1

2027: ₹1,416–₹1,498

1

2030: ₹2,038–₹2,189

1

These projections suggest moderate upside over 5–7 years, but not exceptional.

💰 Ideal Entry Price Zone

Based on technical support and valuation

Entry Zone: ₹880–₹920 This range aligns with historical support and offers better margin of safety.

Avoid entering near ₹1,000 unless there's a breakout above ₹1,020 with strong volume confirmation

2

.

🧭 If You Already Hold the Stock

Exit Strategy / Holding Period

Short-Term Traders: Consider exiting near ₹1,075–₹1,100 if momentum fades

3

.

Long-Term Holders: Hold only if you believe in Tata Group’s strategic pivot (e.g., EV batteries, specialty chemicals).

Exit Trigger: If price drops below ₹880 or ROE/ROCE metrics don’t improve in next 2 quarters.

Broker Sentiment

Kotak Institutional Equities: Maintains “Sell” rating with a target of ₹780

4

Consensus Target: ₹1,027 — limited upside from current levels

5

📌 Summary

Metric Value Verdict

ROE / ROCE 1.2% / 3.96% Weak

PEG Ratio -1.38 Negative growth

Debt-to-Equity 0.33 Moderate

Dividend Yield 1.10% Modest

P/E vs Industry 55.3 vs 27.2 Overvalued

Entry Price Zone ₹880–₹920 Safer entry

Exit Strategy ₹1,075–₹1,100 Short-term exit zone

Would you like a comparison with Deepak Nitrite or Navin Fluorine to explore better chemical sector picks?

1

fincopanda.com

2

in.tradingview.com

3

dailybulls.in

4

www.cnbctv18.com

5

trendlyne.com

Edit in a page