Hindalco hits 52-week high; surges over 40% in one month

In past one-month, the stock surged 43% as compared to 14% rise in Metal index and 6% gain in Sensex.

Hindalco has gained 3% to hit its 52-week high of Rs 124 on the BSE, extending its past one month rally, after the company reported better-than-expected results for the quarter ended March 2016 (Q4FY16).

In past one-month, the stock surged 43% from Rs 87 on May 20, as compared to 14% rise in the S&P BSE Metal index and 6% gain in the S&P BSE Sensex.

Hindalco reported Q4FY16 earnings way ahead of consensus estimates on the back of steep cut in costs.

The company’s standalone bottom line more than doubled to Rs 356 crore in Q4FY16, up 123% year-on-year, mainly because of lower input costs as net sales took a hit due to falling aluminium and copper prices.

Hindalco said the profit before interest depreciation and tax (PBIDTA) rose by 27% with strong contribution from both Aluminium and copper segment. Higher aluminium volumes and lower input costs led to this robust performance.

The global demand continued to remain robust and expected to grow at around 4%. Indian demand rising and is expected to grow smartly on the back of expected pick up in industrial activity, infrastructure spend and focus on power transmission and distribution, it added.

Analysts at Prabhudas Lilladher believes that earnings quality of domestic operations of Hindalco would further improve on the back of optimisation of new smelters, stable LME and structural improvement in availability of domestic coal. This coupled with low capex would drive significant improvement in the company’s gearing ratios and free cash flows in FY17/FY18.

Till 10:08 AM, a combined 4.59 million shares changed hands on the BSE and NSE.