Moneycontrol
Feb 15, 2018 02:14 AM IST | Source: Moneycontrol.com

Buy Hindalco; target of Rs 323: Motilal Oswal

Motilal Oswal is bullish on Hindalco has recommended buy rating on the stock with a target price of Rs 323 in its research report dated 1 February 2018.

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Motilal Oswal's research report on Hindalco


Novelis continued to improve its EBITDA even in the seasonally weakest quarter of the year. 3QFY18 adj. EBITDA increased 20% YoY to USD305m, led by 6% growth in volumes and continuously improving margins. Auto volumes grew 12% YoY, helped by ramp-up in China, boosting EBITDA per ton by 13% YoY (+2% QoQ) to USD383/t.South America reported very strong 17% YoY growth in volumes. This, coupled with operating leverage, led to EBITDA growth of 32% YoY to USD107m.

Outlook

We expect Novelis to leverage the Sierre plant to drive auto line growth in Europe.We believe Hindalco is striking a balance between growth and deleveraging to deliver shareholder returns. Maintain Buy.

For all recommendations report, click here


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