Hindalco Industries reports strong first quarter results, sparking positive broker outlooks as its overseas aluminium division, Novelis, signals recovery and growth prospects, amidst ongoing expansion plans and market volatility.
Hindalco Industries has drawn a fresh wave of optimism from global brokerages after a strong first quarter and signs that its overseas aluminium business, Novelis, is moving towards recovery. HSBC and UBS both kept Buy ratings on the stock, while Jefferies stayed more cautious with a Hold stance, even after lifting its target price. The mix of upbeat earnings, expected operational improvements and heavy investment plans has kept the debate focused on how quickly the company can translate stronger performance into lower debt and sustained returns.
HSBC said Hindalco’s latest quarterly numbers showed solid momentum across both the India business and Novelis, with consolidated EBITDA rising sharply. The bank set a target price of Rs 1,430, suggesting meaningful upside from current levels, and pointed to a possible earnings rebound as the Oswego plant restarts. UBS was also constructive, saying the quarter beat its estimates by a wide margin and that Novelis’ working-capital release could help speed up deleveraging. UBS has a target of Rs 1,325 and expects leverage to fall below four times by the end of fiscal 2027.
Jefferies took a more restrained view. It raised its target to Rs 1,100 from Rs 1,075 but kept its Hold rating, arguing that the latest quarter was strong enough to justify a reset in expectations, yet not necessarily a fresh rerating. The brokerage said the India business benefited from better realisations in aluminium and sulphuric acid, but expects profitability to normalise from the elevated level seen in the quarter. Even so, it noted that valuation still looks reasonable versus earnings and book value.
Hindalco, part of the Aditya Birla Group, is one of the world’s biggest aluminium players by revenue and India’s largest copper producer. The company has been talking up a multi-year expansion push, including more capacity in aluminium and alumina in India, as well as the Bay Minette project in the US. Business Standard reported that Hindalco expects Novelis to remain steady in fiscal 2027, with the Oswego plant restart and Bay Minette commissioning later next year helping support growth in automotive, beverage packaging and speciality aluminium products.
The latest quarterly figures underline why brokerages remain interested. Revenue rose 32.06% year on year to Rs 84,825 crore, EBITDA climbed 76.22% to Rs 13,932 crore and net profit increased 75.15% to Rs 7,013 crore. Livemint reported that total income, however, eased sequentially from the previous quarter, showing that the business still faces volatility. Analysts also point to risks from commodity swings, higher input costs and a capital-heavy expansion cycle, even as the company targets stronger downstream earnings and continued balance-sheet repair.
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