CLSA has maintained its ‘Outperform’ rating on Hindalco with a target price of ₹800, indicating a potential upside of up to 32% from the current market price of ₹604.40.
The company reported in-line domestic results, with India EBITDA coming in at ₹46 billion, reflecting a 17% QoQ growth. Aluminium EBITDA per tonne rose by $103 QoQ to $1,522, supported by an increase of $192 per tonne in LME aluminium prices.
Hindalco’s copper segment EBITDA stood at ₹7.8 billion, up 18% YoY, surpassing expectations. However, management has previously guided that a ₹6 billion per quarter EBITDA run rate is a more sustainable level for this segment.
On the balance sheet front, consolidated net debt increased to ₹418 billion from ₹360 billion in Q2FY25, primarily due to Novelis-related factors.
A key development for Hindalco is securing the Meenakshi coal block, which has a 12 million tonne capacity. This acquisition is expected to fulfill around 75% of Hindalco’s coal requirements, strengthening its cost efficiency in the aluminium segment.
Disclaimer: The above stock update is based on brokerage reports and company announcements. Investors are advised to conduct their own research and consult with a financial advisor before making any investment decisions.
