The IIFL Securities Report: Buy Hindalco Industries - September 26

IIFL Securities has issued a buy recommendation for Hindalco Industries, recommending a target price of Rs 747. This implies an upside potential of over 2.7% from the current market price of Rs 727.05. The brokerage cites the company's robust aluminum demand outlook and its expansion plans as key factors driving its positive view. Hindalco has been investing in capacity expansion, including a new aluminum smelter in Odisha, to meet the growing demand for the metal used in various industries.

About Hindalco  Industries:

Hindalco Industries Limited is a leading aluminum and copper producer with a global footprint. It is a subsidiary of the Aditya Birla Group, one of India's largest conglomerates. Hindalco is the largest aluminum producer in India and one of the largest in the world. The company operates through four segments: Aluminum, Copper, Novelis, and Utkal. The Aluminum segment produces primary aluminum, alumina, and value-added aluminum products. The Copper segment produces copper cathodes and copper rods. The Novelis segment manufactures aluminum sheets, plates, and foils. The Utkal segment produces alumina. Hindalco's products are used in various industries, including automotive, construction, packaging, and electrical.

52 Week Price Trend:

Hindalco Industries' current market price (CMP) of Rs. 727.05 reflects a significant appreciation compared to its 52-week low of Rs. 381. Despite not reaching its 52-week high of Rs. 620.6, the company's stock has gained momentum and is currently trading at a premium. This growth may be attributed to the company's strong performance in the aluminum sector, its strategic initiatives, and the overall positive sentiment in the market. It is important to note that stock market performance can be influenced by various factors, and investors should conduct thorough research and consult financial advisors before making investment decisions.

Stratzy's MOST Analysis:

HINDALCO has received a BBB rating from Stratzy's MOST framework, indicating medium fundamental risks. The framework evaluates companies based on Management, Outlook, Safety, and Trend. HINDALCO's score in each pillar determines the overall rating. A BBB rating suggests that while the company has some strengths and opportunities, there are also areas of concern that investors should consider. This rating can help investors make informed decisions about whether to invest in HINDALCO given its potential risks and rewards.

Company's Fundamentals:

Hindalco Industries (NSE: HINDALCO) is an Indian aluminum and copper producer. Its stock is currently trading at a price-to-earnings (PE) ratio of 12.1, indicating that investors are willing to pay 12.1 times the company's annual earnings per share to own its stock. The stock's price-to-book (PB) ratio of 1.14 suggests that its market value is slightly higher than its book value (the value of its assets minus its liabilities). HINDALCO pays a dividend yield of 0.59%, indicating that investors receive an annual dividend payment of 0.59% of the stock's current market price. These metrics provide insights into the company's valuation, profitability, and dividend payout, helping investors make informed investment decisions.

Fundamental and Technical information provided in this blog were last updated on 26 Sep, 2024

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