Limelight on Hindalco shares as Q2 profits plummet 36%

Hindalco shares in focus after reduced Q2 profits

Expert assessment of Hindalco Industries shares

Hindalco Industries, an Aditya Birla Group company, published its quarterly reports for the quarter ending September 30th, 2022. The reports showed a fall in the consolidated net profits even though revenues rose annually.

Here’s a look at the results –

Hindalco shares in focus after reduced

These figures have put the company’s scrip in the limelight as dwindled profits might spell a fall in the share price.

Related - Check out these monopoly stocks trading at a discount

However, despite the reduced profits, the shares of Hindalco Industries saw a 5% jump in their market value in the early trading hours of November 14th, 2022. This has got analysts and brokerage houses talking about the expected share performance in the short run. Let’s see what the experts have to say about Hindalco’s scrip –

Expert assessment of Hindalco Industries shares

Hindalco stated that the fall in aluminum prices and the increased input costs hampered its profitability. Experts predict that its EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) is expected to be around $525 per tonne after the next six months as the contracts are renewed. However, the company might suffer headwinds in the short run, given the lower metal spreads.

Moreover, the pessimistic outlook at the macroeconomic level due to Europe’s recession, China’s slowdown, and the increased inflation in the US might restrict growth.

Most analysts believe that you can buy Hindalco’s shares as the company's future earnings might increase due to increased domestic business. However, China will remain a primary influencer in Hindalco’s future performance, which you should keep in mind if you want to invest in the company.

Experts suggest a target price between Rs.520 and Rs.560 per share. While the short-run performance of the company can be assessed to be profitable, determining the long-term margins is proving to be a challenge.

What should you do?

As an investor, you can invest in the Hindalco industries as the short-term outlook is positive. However, you should monitor the stock movement as the prices are also affected by external macroeconomic factors. Check for the target price and make your investment decisions prudently to avoid potential losses.

Related - Find out which stocks made the headline in the second week of November 2022

Hindalco Industries, an Aditya Birla Group company, published its quarterly reports for the quarter ending September 30th, 2022. The reports showed a fall in the consolidated net profits even though revenues rose annually.

Here’s a look at the results –

Hindalco shares in focus after reduced

These figures have put the company’s scrip in the limelight as dwindled profits might spell a fall in the share price.

Related - Check out these monopoly stocks trading at a discount

However, despite the reduced profits, the shares of Hindalco Industries saw a 5% jump in their market value in the early trading hours of November 14th, 2022. This has got analysts and brokerage houses talking about the expected share performance in the short run. Let’s see what the experts have to say about Hindalco’s scrip –

Expert assessment of Hindalco Industries shares

Hindalco stated that the fall in aluminum prices and the increased input costs hampered its profitability. Experts predict that its EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) is expected to be around $525 per tonne after the next six months as the contracts are renewed. However, the company might suffer headwinds in the short run, given the lower metal spreads.

Moreover, the pessimistic outlook at the macroeconomic level due to Europe’s recession, China’s slowdown, and the increased inflation in the US might restrict growth.

Most analysts believe that you can buy Hindalco’s shares as the company's future earnings might increase due to increased domestic business. However, China will remain a primary influencer in Hindalco’s future performance, which you should keep in mind if you want to invest in the company.

Experts suggest a target price between Rs.520 and Rs.560 per share. While the short-run performance of the company can be assessed to be profitable, determining the long-term margins is proving to be a challenge.

What should you do?

As an investor, you can invest in the Hindalco industries as the short-term outlook is positive. However, you should monitor the stock movement as the prices are also affected by external macroeconomic factors. Check for the target price and make your investment decisions prudently to avoid potential losses.

Related - Find out which stocks made the headline in the second week of November 2022

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