Hindalco shares in focus after Q3 PAT jumps 60% YoY. Should you buy, sell or hold?

Synopsis

Hindalco reported a 60% YoY growth in consolidated net profit for Q3FY25, reaching Rs 3,735 crore, with a revenue increase of 11%. The company's India business PAT surged 134% YoY, and aluminium upstream EBITDA rose 73%. Analysts maintain positive ratings with target prices of Rs 670 and Rs 800.

Shares of Hindalco will be in focus on Friday, February 14, after the company reported a 60% year-on-year (YoY) growth in consolidated net profit for Q3FY25, rising to Rs 3,735 crore from Rs 2,331 crore in the same period last year.

The revenue from operations in Q3FY25 stood at Rs 58,390 crore, up 11% from Rs 52,808 crore reported in the corresponding quarter of the last financial year.

The Aditya Borla Group's flagship company reported a 4.4% decline in its profit after tax on a sequential basis versus Rs 3,909 crore reported in Q2FY25 though the topline saw a marginal uptick (0.32%) on a quarter-on-quarter basis against Rs 58,203 crore in the July-September quarter.

Hindalco's India business PAT surged 134% YoY to Rs 2,885 crore. The company reported record aluminium upstream EBITDA at Rs 4,222 crore, up 73%, with an EBITDA margin of 42%. Copper EBITDA rose 18% to Rs 777 crore, while consolidated EBITDA increased 28% to Rs 8,108 crore.

The consolidated net debt to EBITDA stood at 1.33x as of December 31, 2024. Hindalco secured Meenakshi Coal Mines boosting resource security.

Novelis

Should you buy, sell, or hold Hindalco's stock? Here's what analysts say:

CLSA maintained an 'Outperform' rating on Hindalco with a target price of Rs 800.

The company's Q3 results were in line with expectations, and it has successfully secured a coal block. Aluminum profitability for the quarter was in line with estimates, while consolidated debt increased due to Novelis. Additionally, Hindalco has guided for a steady ₹600 crore profitability in its copper business.

JP Morgan

JP Morgan maintained an 'Overweight' rating on Hindalco with a target price of Rs 670.

The company reported an EBITDA beat in its Indian business, driven by lower costs and improved copper business performance. Hindalco has secured the Meenakshi coal mine allocation with a 12 MTPA capacity, and its ongoing projects are on track. A key factor to watch will be the impact of US tariffs.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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