Hindalco - Available At Near To 10‐Year Low EV/Ebitda: Centrum Broking
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Centrum Broking Report
Hindalco Industries Ltd.'s share price has fallen ~50% from its peak of March 2022 with investors having concern on its huge capex plans coinciding with falling aluminum prices and possibilities of earnings hit of Novelis amid recessionary fear in developed economies like U.S. and Europe.
We believe that the stock has factored in pessimism and market failed to single out the companies like Hindalco Industries whose earnings are relatively less susceptible to commodity prices and ~60% of Ebitda comes from conversion business which is intact.
We believe that fundamentals of aluminum are robust and there should not be any major fall from current price of $2,500/tonne.
However, with China increasing exports, global deficit may reduce and accordingly, we cut our average London Metal Exchange aluminium prices to $2,600/tonne in FY23E and $2,400/tonne in FY24E, leading to 3%/6% cut in FY23E/FY24E Ebitda.
Click on the attachment to read the full report:
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.