Aluminium players Hindalco, NALCO, Vedanta surge 7-10% in five days amid rise in metal prices

The Nifty Metal index has surged 5% in the last one week.

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26 Aug, 2025 12:21

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Shares of aluminium manufacturers—Hindalco Industries, National Aluminium Co, and Vedanta, have been on a strong rally over the past week, climbing 7-10 percent, driven by a surge in base metal prices.

Aluminium prices have gradually risen over the past week and surpassed $2,700 per tonne mark in response to the European Union's ban on Russian aluminium imports, invoking fears of a supply void. Higher metal prices tend to bode well for companies like Hindalco, NALCO and Vedanta as it aids their profit margins.

To that effect, these stocks have seen strong buying action this past week, which has also lifted the Nifty Metal index nearly 6 percent higher.

At 12.13pm, shares of NALCO were trading at Rs 199.73, Hindalco at Rs 650.55 and Vedanta at Rs 434.50 on the NSE.

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Brokerage firm Emkay Institutional Equities further highlighted that at current stock prices, the market is factoring in 16.5 percent lower commodity prices for Nalco, 11 percent lower for Vedanta, and 9.8 percent higher for Hindalco. "This exercise indicates that stocks — where the market is pricing in lower commodity prices — tend to provide better downside cushion with a view that elevated earnings could normalise over time," Emkay wrote in a note.

Based on this, Emkay expects Hindalco, NALCO and Vedanta generate upcycle profitability and
returns at the current price level. The brokerage also noted the cheap valuations of these stocks as against the strength in metal prices, further hinting towards a positive run in the near-term.

Meanwhile, should alumina and aluminium prices stay higher for longer, Emkay believes the near-term earnings for the three metal companies would be due for an upgrade, which would work favourably for their stock price performance.

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