Motilal Oswal's research report on Hindalco
Novelis reported a weak financial performance in 3QFY23, missing our estimates. The performance was affected by lower shipments due to beverage packaging destocking and a weak macro scenario. Revenue/adj. EBITDA/APAT declined by 12%/32%/39% QoQ to USD4,021m/ USD341m/USD145m. Revenue was in line with our estimate, while Adj. EBTIDA/APAT significantly missed our estimates of USD427m/USD175m. EBITDA was affected by lower volumes, higher operating costs and negative forex impact of USD18m. EBITDA/t at USD376/t (-31% YoY/-26% QoQ) was below our estimate of USD427/t. Shipments stood at 908kt (-2% YoY/-8% QoQ), 9% below our estimate of 1,000kt.
Outlook
Our SoTP-based TP for Hindalco works out to INR600. The stock is trading at 5.3x/3.8x our FY23E/24E EV/EBITDA and 1.3x FY24E P/B. Maintain BUY.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!