Hindalco Q1 Results Review - In Capex Mode: ICICI Securities

ICICI Securities Report

Hindalco Industries Ltd.’s Q1 FY25 consolidated Ebitda was 5% ahead of Street’s estimate. Key points:

1. Record copper Ebitda of Rs 8.05 billion on account of higher treatment/refining charges margins and higher downstream sales volume.

2. Al (upstream) Ebitda/tonne was aided by higher London Metal Exchange Aluminium prices and benign cost.

3. India operations reported net cash position of Rs 17 billion.

4. Consolidated net debt/Ebitda was at 1.24 times versus 1.73 times a year ago.

Management expects to start the upstream capex in India across all three products – alumina, copper and aluminium – aided by its healthy balance sheet that sports sufficient headroom for growth.

At Novelis, we expect rejuvenated beverage can volumes and softening costs would maintain Ebitda in the range of $535-545/tonne. Maintain Buy and a target price of Rs 830 on seven times FY26E Ebitda.

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