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Hindalco slips as a foreign brokerage retains underweight rating

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Capital Market
Last Updated : Jul 04 2014 | 11:54 PM IST

Hindalco Industries fell 1.24% to Rs 171.60 at 14:07 IST on BSE on reports a foreign brokerage maintained its underweight rating on the stock.

Meanwhile, the BSE Sensex was down 26.01 points, or 0.10%, to 25,797.74.

On BSE, so far 7.69 lakh shares were traded in the counter, compared with an average volume of 11.49 lakh shares in the past one quarter.

The stock hit a high of Rs 174.50 and a low of Rs 170.95 so far during the day. The stock hit a 52-week high of Rs 179 on 2 July 2014. The stock hit a 52-week low of Rs 83.05 on 7 August 2013.

The stock had outperformed the market over the past one month till 3 July 2014, rising 11.99% compared with 3.88% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 26.78% as against Sensex's 14.73% rise.

The large-cap company has an equity capital of Rs 206.46 crore. Face value per share is Re 1.

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According to reports, the brokerage remained underweight on the Hindalco Industries stock as it sees medium-term concerns about profitability trends from the new greenfield projects in India, even though it sees good long-term prospects in solid Novelis operations, top-notch assets at the new greenfield sites and the likelihood of balance sheet deleveraging from here.

After a recent management meet, the brokerage reportedly felt Hindalco's key medium-term focus is to consolidate the balance sheet and intense focus is on quick ramp-up and stabilisation of the Mahan, Aditya and Utkal projects.

Once all permissions are received the Mahan coal block may take about 12 months to reach the 60% utilisation mark and about 18 months to reach 100% utilisation, the brokerage reportedly said.

Hindalco Industries' net profit declined 48.5% to Rs 248.15 crore on 19.7% growth in total income to Rs 8647.53 crore in Q4 March 2014 over Q4 March 2013.

Hindalco Industries is the world's largest aluminium rolling company and one of the biggest producers of primary aluminium in Asia. Its copper smelter is the world's largest custom smelter at a single location.

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First Published: Jul 04 2014 | 2:14 PM IST

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