Tata Steel shares rally over 5%. Check out Jefferies' target price

Shares of Tata Steel NSE -0.67% rallied over 5% to RS 118.95 in Monday's trade on BSE after global brokerage firm Jefferies turned positive on Indian metals stocks.

Global brokerage Jefferies upgraded its hold rating on Tata Steel to a buy rating with a target price of

Rs 150, implying an upside potential of 28% from the current market price of Rs 117 per share.

"After almost a year of cautious view, we turn positive on India metals; China started to ease Covid-19 policy and support its ailing property sector. We believe the worst-margin quarter for Indian Steel, and the big chunk of earnings cuts for Tata Steel are behind," the brokerage firm Jefferies said.

"Tata Steel's PB and EV /IC valuations are close to its long-term averages, which we find attractive amid its improving asset footprint and balance sheet.

We upgrade Tata Steel from hold to buy," it added.

At 10.56 am, the scrip was trading 3.8% higher at Rs 117 over its previous day's closing price of Rs 112.65 apiece. The stock has surged nearly 37% in the last six months, while it has risen only 2% in the last year.