Buy Hindalco; target of Rs 520: Motilal Oswal

Motilal Oswal is bullish on Hindalco recommended buy rating on the stock with a target price of Rs 520 in its research report dated August 05, 2021.

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// else // $ (‘#toptitleTXT’).html(tickTxt+typevar+’already exists in your watchlist’); // //} } //$ (‘.accdiv’).html(”); //$ (‘.accdiv’).html(appndStr); } }, //complete:function(d){ // if(typparam1==1) // { // watchlist_popup(‘open’); // } //} }); }); } else { var disNam =’stock’; if($ (‘#impact_option’).html()==’STOCKS’) disNam =’stock’; if($ (‘#impact_option’).html()==’MUTUAL FUNDS’) disNam =’mutual fund’; if($ (‘#impact_option’).html()==’COMMODITIES’) disNam =’commodity’; alert(‘Please select at least one ‘+disNam); } } else { AFTERLOGINCALLBACK = ‘overlayPopup(‘+e+’, ‘+t+’, ‘+n+’)’; commonPopRHS(); /*work_div = 1; typparam = t; typparam1 = n; check_login_pop(1)*/ } } function pcSavePort(param,call_pg,dispId) { var adtxt=”; if(readCookie(‘nnmc’)){ if(call_pg == “2”) { pass_sec = 2; } else { pass_sec = 1; } var url = ‘//www.moneycontrol.com/mccode/common/saveWatchlist.php’; $ .ajax({url:url, type:”POST”, //data:{q_f:3,wSec:1,dispid:$ (‘input[name=sc_dispid_port]’).val()}, data:{q_f:3,wSec:pass_sec,dispid:dispId}, dataType:”json”, success:function(d) { //var accStr= ”; 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Motilal Oswal’s research report on Hindalco

Novelis, Hindalco’s wholly-owned subsidiary, reported record-high adj EBITDA of USD508m (adj for one-off income of USD47m) on the back of record-high margins of USD522/t (+2% QoQ). Novelis should see mix improvement in 2HFY22 and FY23 as the share of auto volumes should increase on account of capacity additions. We raise our consolidated FY22E/FY23E EBITDA by 3%/6%, factoring in a higher aluminum price assumption (+3%/7% to USD2,375/USD2,300 per tonne for FY22/FY23). Reiterate Buy.

Outlook

The stock trades at 5.2x EV/EBITDA and 8.7x P/E on FY22E. We value HNDL at INR520/share on an SoTP basis. Reiterate Buy.

For all recommendations report, click here

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