IIFL Securities Stock Idea: Buy National Aluminium Co with Target Rs 221

IIFL Securities has recommended a buy rating for National Aluminium Co (NALCO) with a target price of Rs 221, indicating a potential upside of over 3%. The current market price of NALCO is Rs 213.18. The brokerage firm believes that the company's strong presence in the domestic aluminium market, its integrated operations, and its expansion plans will drive future growth. NALCO's consistent financial performance and attractive valuations also support IIFL's buy call.

About National Aluminium Co:

National Aluminium Company Ltd. (NALCO), a Government of India undertaking, is one of the largest integrated aluminium producers in the world. Established in 1981, NALCO operates an integrated aluminium complex comprising bauxite mines, alumina refinery, smelter and captive power plants at Angul in Odisha. The company's product portfolio includes alumina, aluminium, aluminium alloys, and power. NALCO has a strong presence in the domestic and international markets, with exports to over 50 countries. With a focus on sustainable operations, NALCO has adopted various green initiatives and is committed to environmentally friendly aluminium production.

52 Week Price Trend:

National Aluminium Co (NALCO) has witnessed a significant rise in its stock price, currently trading at Rs 213.18. This represents a substantial increase compared to its 52-week low of Rs 75.7, indicating a positive market sentiment. However, it is worth noting that NALCO's stock price is still below its 52-week high of Rs 169.3, suggesting potential for further growth. Investors should carefully consider market conditions and the company's financial performance before making investment decisions.

Stratzy's MOST Analysis:

NATIONALUM has received a BBB rating from Stratzy's MOST framework, indicating a medium fundamental risk. This rating is based on an assessment of the company's management, outlook, safety, and trend. The MOST framework evaluates each of these pillars separately and then combines the scores to create an overall rating. A BBB rating indicates that NATIONALUM has a sound management team, a positive outlook, a strong safety record, and a stable trend. However, it also suggests that there are some potential risks that investors should be aware of before investing in the company.

Company's Fundamentals:

National Aluminium Co (NSE: NATIONALUM) trades at a Stock PE of 18.4, indicating that investors are willing to pay 18.4 times the company's annual earnings per share. Its PB Ratio of 2.12 suggests that the stock is priced at 2.12 times its book value, indicating that investors believe the company's assets are undervalued. Additionally, NATIONALUM offers a Dividend Yield of 2.87%, providing investors with a passive income stream. These metrics suggest that NATIONALUM is currently fairly valued, offering both growth potential and dividend income.

Fundamental and Technical information provided in this blog were last updated on 28 Sep, 2024

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