Analyst's Pick: LARGE CAP: Macquarie Securities

TATA STEEL
CMP: Rs 650

Tata Steel reported Q2 consolidated results in line with our operating line estimates. Of $346m, 15% is of our full year estimate of $2.2bn.

However, there is a good chance of it achieving the remaining $1.8bn as we expect volumes to improve by about 11% in H2 to 13.9mt and coking coal costs to reduce by about $100/t.

Tata Steel is the best stock to play the rebound. Its Indian operations benefit from rising raw materials costs due to its integrated nature.