Buy Hindalco Industries; target of Rs 800: Anand Rathi

Anand Rathi is bullish on Hindalco Industries has recommended buy rating on the stock with a target price of Rs 800 in its research report dated February 15, 2025.

Broker Research

February 17, 2025 / 12:43 IST

Buy

26 Aug, 2025 12:21

Volume

Todays L/H

Anand Rathi's research report on Hindalco Industries

Hindalco’s 600k-tonne strategic expansion in Bay Minette is on track to be completed in H2 CY26. The recently commissioned 250k-tonne Guthrie facility continues to ramp up automotive sheet ingot casting and the 100ktonne recycling centre in Ulsan (South Korea) has been commissioned. Aditya FRP facility is to be commissioned in FY26, which would take the cumulative downstream capacity to 600k tonnes. The company is rapidly shifting to RE, with a 189MW capacity already commissioned; it targets to reach 300MW by H1 CY25. Despite better volumes and EBITDA/tonne expected for Novelis in Q4, we slightly trim our FY25e/26e/27e EBITDA/tonne by 4.3%/2.9%/3.3%, in line with reduced operating profit and scrap crunch. However, considering the best-in-industry aluminium EBITDA/tonne and strong domestic demand, we raise our upstream aluminium estimates by 13.6%/13.6%/10.1% for FY25/26/27. We retain a Buy rating, with a sum-of-parts TP of Rs800/sh on capex progressing per timeline, an uptick in beverage can shipments, Novelis’ ongoing technology development to enhance scrap and the 12m-tonne Meenakshi coal block allocation.

Outlook

As the company has integrated its business model with its focus on integrating RM and enhancing the share of VAP, the impact in one business vertical is absorbed by others, thus reducing the impact on consolidated financials. We retain a Buy with an unchanged TP of Rs800/share.

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