Shares of Hindalco Industries remained in focus on Tuesday, May 27, after global brokerage Morgan Stanley initiated coverage on the stock with an “Overweight” rating and a target price of Rs 1,325, implying further upside from current levels.
The brokerage turned positive on Hindalco citing a tighter global aluminium demand-supply outlook, strong structural demand in India, elevated London Metal Exchange (LME) aluminium prices, and expected recovery in Novelis operations from FY28.
Hindalco shares were trading at Rs 1,145.60, up 3.79% in Tuesday’s session. The stock touched an intraday high of Rs 1,154 and is currently trading near its 52-week high of Rs 1,154, according to exchange data. The company’s market capitalisation stood at around Rs 2.56 lakh crore.
Morgan Stanley said Hindalco’s India business is likely to benefit from improving aluminium prices and strong domestic demand trends. The brokerage also expects Novelis recovery from FY28, supported by the Bay Minette ramp-up and normalization at Oswego.
The brokerage further highlighted strong free cash flow generation and deleveraging as additional positives that could support value unlocking over the medium term.
Morgan Stanley also expects Hindalco to outperform the broader industry over the next 60 days, supported by elevated LME aluminium prices and low inventory levels globally.
Hindalco share price target
Morgan Stanley has initiated coverage on Hindalco with an “Overweight” rating and assigned a target price of Rs 1,325 per share.
The brokerage believes the company is well placed to benefit from a favourable aluminium cycle, improving India operations, and a gradual recovery in Novelis earnings from FY28 onward.
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