Hindalco shares: Brokerages stick to 'Buy' calls; Elara, Axis trim targets, Nuvama upgrades

Brokerages have largely maintained a positive stance on Hindalco Industries Ltd, with Elara Securities and Axis Securities reiterating their 'Buy' ratings while lowering their respective target prices. On the other hand, Nuvama Institutional Equities upgraded the stock to 'Buy' and raised its target price.

Elara Securities reiterated its 'Buy' rating on Hindalco but lowered its sum-of-the-parts (SOTP)-based target price to Rs 1,227 from Rs 1,270, factoring in lower London Metal Exchange (LME) aluminium price assumptions.

The domestic brokerage said Hindalco reported consolidated EBITDA of around Rs 12,800 crore, ahead of its estimates and consensus expectations. The performance was supported by $39 million in business interruption insurance proceeds related to the 2025 Oswego fire and stronger-than-expected profitability in the copper business.

Elara expects Novelis' profitability to improve, supported by a recovery in volumes at the Oswego plant and continued structural cost savings. In India, more than Rs 50,000 crore of expansion projects are under execution, while another Rs 50,000 crore of growth opportunities are under evaluation, reflecting long-term demand visibility, it said.

The brokerage added that structural cost advantages, the commissioning of the coal mine and ongoing capacity additions could further support earnings growth.

Copper business posts record EBITDA

Hindalco's copper business reported an all-time high EBITDA of Rs 1,670 crore in Q2 FY27, up around 164 per cent year-on-year (YoY), Elara noted. The performance was significantly ahead of the brokerage's guidance of around Rs 900 crore, supported by higher realisations of by-products such as sulphuric acid and certain one-off gains.

Elara, however, lowered its EBITDA estimates by around 2 per cent for FY27 and 3 per cent each for FY28 and FY29, factoring in lower LME aluminium prices.

The brokerage continues to value Novelis at 5.5 times and Hindalco's other businesses at 6 times. It identified a slowdown in demand across key end-user industries, weak aluminium prices and adverse currency movements as key risks to its investment call.

Axis Securities also maintained its 'Buy' rating on Hindalco but cut its target price to Rs 1,060 per share from Rs 1,155 earlier.

In contrast, Nuvama Institutional Equities upgraded the stock to 'Buy' and raised its target price to Rs 1,184 from Rs 1,108 earlier.

Global brokerages Nomura and UBS have also maintained a positive stance on Hindalco, recommending 'Buy' ratings with target prices of Rs 1,100 and Rs 1,325, respectively.