Q2FY23 Preview: Hindalco Industries: Revenue seen at Rs479,848 million, PAT at Rs25,453 million

Result date: 11^th November, 2022
Recommendation: Buy
Target price: Rs516
(Source: IIFL Research)

Hindalco Industries (Hindalco) could witness 4% sequential growth in volumes even as aluminium LME fell 17% sequentially. Lower prices of both aluminum and copper could hit revenue during the quarter. The company’s consolidated revenue could inch up by a meagre 0.63% over the year-ago quarter.

Weakness in revenue could trickle down to EBITDA which could be impacted by lower aluminum profits, with higher copper profits providing some cushion. Aluminum segment’s profits would be impacted by higher coal costs partly.

Consequently, Hindalco’s Profit After Tax (PAT) could decline ~26% over the year-ago quarter.

Important management insights to watch out for:

• Guidance on Indian upstream capex timelines
• Update on capex for Novelis
• Novelis’ guidance on shipments and EBITDA

Rs. Million	September 2022 estimates	QoQ change	YoY change
Revenue	479,848	(17.33)%	0.63%
EBITDA	58,724	(30.17)%	(23.00)%
Profit After Tax	25,453	(37.97)%	(25.63)%

Source: Brokerage Reports