HINDALCO - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 4.6

🧾 Core Financial Analysis

📈 Profitability & Growth

PAT Qtr: ₹5,278 Cr vs ₹3,762 Cr — ↑66.3% QoQ growth, exceptional earnings momentum.

EPS: ₹71.2 — very strong, supports valuation.

ROE (14.5%) & ROCE (15.2%) — solid, though not industry-leading, still respectable for a capital-intensive business.

💰 Cash Flow & Debt

Debt-to-Equity: 0.52 — moderate leverage, acceptable for a metals company.

Dividend Yield: 0.72% — modest, but consistent.

Cash Flow: Likely strong given earnings surge, though cyclical volatility is inherent.

📊 Valuation Metrics

Metric Value Insight

P/E Ratio 9.36 Deeply undervalued vs industry PE of 17.7

P/B Ratio ~1.26 Very reasonable — near book value

PEG Ratio 1.25 Fairly priced relative to growth

Intrinsic Value Estimated ~₹750–₹800 Based on earnings and sector multiples

🏭 Business Model & Competitive Advantage

Sector: Metals — aluminum, copper, and downstream products.

Global Presence: Through Novelis, Hindalco is a global leader in aluminum rolling and recycling.

Diversification: Strong presence across upstream (mining, smelting) and downstream (automotive, packaging).

Competitive Edge: Vertical integration, global scale, and cost efficiency.

Risks: Commodity price volatility, energy costs, and global demand cycles.

📉 Technical & Sentiment Indicators

RSI: 60.0 — mildly bullish, not overbought.

MACD: 6.64 — positive momentum.

DMA 50 & 200: Price above both — bullish trend.

Volume: Slightly below average — watch for breakout confirmation.

💡 Investment Guidance

📌 Entry Zone (If Undervalued)

₹660–₹690 — current price is near ideal entry zone.

Accumulate on dips toward ₹670 with confirmation of volume and RSI support.

📈 Long-Term Holding View

Strong buy for long-term investors.

Undervalued relative to earnings and book value.

Global aluminum demand, EV sector, and packaging growth are long-term tailwinds.

Hold with a 3–5 year horizon for potential upside toward ₹850–₹900.

Want a comparative analysis with peers like Vedanta or Tata Steel to explore sector positioning?

Edit in a page