The brokerage house said aluminum price has sharply corrected from its peak on the back of expected demand slowdown globally and pick – up in aluminum output from China has further adversely impacted LME prices. It added that the demand environment across the can segment is expected to remain robust given its counter cyclical nature and sectoral supply constraints.
It further added that the company also enhanced its coal security by winning Meenakshi and Chakla coal mines in recent auctions. Also, Novelis announced USD 3.4 billion of strategic capital investments towards transformational organic growth over the next five years driven by encouraging demand trends.
Axis Securities also has a ‘Buy’ call on
Industries with a target price of Rs 510. For Centrum Broking, Hindalco is worth Rs 573. Expects Hindalco to grow steadily in the future backed by market recovery, positive macros, improved operational efficiencies and global demand growth. Also, the company is investing heavily to fuel the growth, it added.
The brokerage firm has reiterated the ‘buy’ rating on the stock with a rolled forward target price of Rs 466.
Motilal Oswal, however, said that while Novelis remains the bright spot in Hindalco’s consolidated profitability, the concerns on its India business are transitory. “We cut our FY23 EBITDA/PAT estimate by 16-22 per cent, at the consolidated level, driven by a 28 per cent reduction in India EBITDA due to higher coal costs. We expect the coal crisis to dissipate in the next one-to-one -two quarters,” it added.
The brokerage house has maintained a ‘buy’ rating with a SoTP-based target price of Rs 555 per share. An extended coal crisis remains the key risk, it said.
, Hindalco is feeling the possible pinch of aluminum returning into surplus (from deficit) over FY23/24E, along with the traded instrument facing the headwinds of a rising interest rate environment and possible compression in Novelis margins. It has a ‘reduce’ call on Hindalco Industries with a target price of Rs 295.
Hindalco reported a doubling of consolidated profit at Rs 3,851 crore in the March quarter, a record high for any quarter, compared with Rs 1,928 crore in the same quarter last year. Consolidated revenue for the fourth quarter rose 38 per cent to Rs 55,764 crore compared with Rs 40,507 crore in the corresponding quarter last year.
Promoters held 34.64 per cent stake in the company as of 31 March 2022, while FIIs owned 28.85 per cent, DIIs 19.22 per cent.
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