Hindalco Industries share price: Hindalco Industries’ stock price rose 6 percent in early trading on Friday, May 27, after the company announced its March quarterly results Thursday evening. The shares have hit a 52-week high of Rs 636 and a 52-week low of 359.80. The stock has reached an upper price range of 448.50 and a lower price range of 367. Hindalco has outperformed its competitors. The company Thursday reported a doubling of its consolidated profit of Rs 3,851 crore in the March quarter, a record for any quarter, compared to Rs 1,928 crore in the same quarter last year. Consolidated revenue for the fourth quarter increased by 38 percent to Rs 55,764 crore compared to Rs 40,507 crore in the corresponding quarter last year.
There is an 11 percent increase in net income from the net income of Rs 50,272 crore recorded in the previous quarter. Hindalco’s consolidated net profit has registered a growth of nearly 300 percent to Rs 13,730 crore from Rs 3,483 crore registered in FY 2021.
In terms of dividend, Hindalco’s board of directors has recommended a dividend of 400 percent or Rs 4/share for the current fiscal year, compared to 300 percent or Rs 3/share in the past fiscal year. Hindalco Industries Ltd has informed BSE that at its meeting of 26 May 2022 the Board of Directors of the Company has recommended, among other things, a dividend of Rs. 4 per share of shares, or 400 percent of the par value of Re. 1/- each for the year ending March 31, 2022, subject to shareholder approval at the subsequent annual general meeting of the company.
Should Investors Buy, Sell, or Hold Hindalco Shares?
Axis Securities, said: “Hindalco reported a strong set of figures with consolidated revenue up 38 percent year-on-year and 11 percent quarter-on-quarter against Rs 55,764 Cr in line with our estimate of Rs 54,697 Cr. EBITDA stood strong at Rs 7,597 Cr , up 30 percent year-over-year, flat QoQ, and in line with our estimate Year-over-year growth was led by higher EBITDA of Aluminum India due to strong aluminum prices Flat EBITDA performance Quarter was led by the decline in Novelis EBITDA mainly due to higher energy prices in Europe Adjusted PAT was strong at Rs 3,851 Cr, up 100 percent year on year and 5 percent year on quarter, but missed our estimate due to higher depreciation and interest charges. the quarter with net debt of Rs 39,096 Cr as of Mar 22 vs Rs 43,733 Cr as of Dec 21, with improvement in net debt to EBITDA to 1.36x i n Q4FY22 versus 1.62x in Q3FY22. The company announced a dividend of Rs 4/share at a payout ratio of 6.5 percent.” Furthermore, the brokerage has maintained a ‘BUY’ call but with a lower target price of Rs 510.
“We reduced our EBITDA/PAT estimate for FY23 by 16 percent /22 percent, at a consolidated level, thanks to a 28 percent reduction in EBITDA in India due to higher coal costs. We expect the coal crisis to subside in the next one to two quarters,” Motilal Oswal said in a note.
The brokerage is maintaining its ‘buy’ rating with a SoTP-based target price of Rs 555 per share. A protracted coal crisis remains the main risk.
Jefferies brokerage maintained its hold rating on the stock and lowered its target to Rs 440 per share. EBITDA fell by 1 percent quarter on quarter, but 4 percent above expectations. The aluminum margin in India has peaked, while Spot aluminum is already 13 percent below the fourth quarter.
After two strong years, Jefferies expects FY23 EBITDA and EPS to decline 6-13 percent year-over-year. The stock is trading above its long-term average, despite the deteriorating global outlook.
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