Why is Hindalco's stock losing today?

1 Jun 2022 , 02:41 PM

Hindalco’s stock is on a losing streak today. Till 2:23 p.m. the stock had lost 3.77% over its closing price the previous day. Five days ago, the company posted record profits in March quarter. Its net profit in March 2022 quarter increased to Rs 3851 crore from Rs 1928 crore in the March quarter of the previous year.

After the announcement of its quarterly results, Hindalco’s share price rose to Rs. 427 by the end of trading on 31^st May. The decline today has happened only because investors in the stock have started booking profits by selling the stock. When there is more selling than buying of a stock its price tends to fall.

In these times of great uncertainty investors have chosen the path of short-term profit — booking and value-buying. This is being seen even in the case of the stock of Hindalco too — a company with strong fundamentals. Hindalco’s strong competitive advantage comes from its ability to be one of the lowest-cost producers of aluminium in the entire world. But investors do not seem to be willing to take a long term bet even on a stock like Hindalco. Hindalco is ranked among the biggest manufacturers of Copper and aluminium products in the world.