Synopsis: HSBC has maintained a ‘Buy’ rating on this leading aluminum and copper conglomerate with a revised fair value of Rs.1,740 per share and a target price of Rs.1,430, implying an upside of 35% from the current price. The brokerage raised its FY28 EBITDA estimate by 9%, citing firm LME aluminum prices, surging physical premiums, and an expected recovery at its North American subsidiary following a plant fire.
A leading domestic aluminum and copper conglomerate is back in focus after a global brokerage reinforced its bullish outlook, raising its earnings estimates on the back of surging physical premiums and a tightening global supply environment. With its North American subsidiary poised for an operational recovery, institutional conviction in the stock remains firm despite a near-term dip in the share price.
With a market capitalization of approximately Rs. 238,600 crore, the shares of Hindalco Industries were trading at around Rs. 1,055 per share, with a 52-week range of Rs. 1,176 to Rs. 633.50. It is trading at a P/E of approximately 13x.
HSBC’s Buy Call
HSBC maintained its ‘Buy’ rating on Hindalco Industries with a target price of Rs.1,430 per share, implying an upside of approximately 35% from the current market price of Rs.1,055. Physical aluminum premiums have risen sharply, with recent offers crossing $450 per tonne, while a sustained LME price environment has prompted the brokerage to raise its FY28 EBITDA estimate by 9%, lifting its fair value to Rs.1,740 per share.
HSBC also expects the stock’s recent underperformance to reverse as Novelis normalizes operations following the Oswego plant fire, aided by a favorable pricing backdrop. The brokerage noted Hindalco currently trades at 4.6x EV/EBITDA on spot LME assumptions, a level it considers an attractive risk-reward entry point. Hindalco shares have gained nearly 20% in 2026 despite Monday’s decline.
FY26 & Q4 FY26 Financial Snapshot
For FY26, Hindalco reported consolidated revenue of Rs.274,944 crore, up 15% year-on-year. Business Segment EBITDA grew 6% to Rs.37,217 crore. PAT before exceptional items came in at Rs.18,732 crore, up 10% year-on-year; reported PAT stood at Rs.13,391 crore, impacted by exceptional charges related to the Oswego fire.
Novelis reported full-year revenue of Rs.159,671 crore, up 13%, though its PAT was sharply compressed to Rs.521 crore from Rs.5,086 crore in FY25, reflecting the operational and financial impact of the Oswego plant fires.
For Q4 FY26, consolidated revenue rose 20% year-on-year to Rs.78,133 crore. Business Segment EBITDA grew 11% to Rs.10,812 crore, & the PAT is down by 51% to Rs.2,597. The India business delivered standout numbers, with revenue up 34% to Rs.35,016 crore and PAT up 11% to Rs.3,549 crore. Copper EBITDA surged 48% to Rs.907 crore.
Novelis posted Q4 revenue of Rs.43,117 crore, up 11% year-on-year, with adjusted EBITDA at $459 per tonne, up 10%, though net income remained in the red at $(84) million due to ongoing Oswego-related costs.
LME aluminum averaged $3,195 per tonne in Q4 FY26, with spot prices subsequently crossing $3,600 per tonne following supply disruptions tied to the West Asia conflict. India’s domestic aluminum demand for the quarter is estimated at 1,561 KT, up 9% year-on-year.
For Investors
HSBC’s revised estimates and sustained Buy call position Hindalco as a compelling bet on the global aluminum upcycle, with the India business continuing to compound steadily and Novelis set for a recovery-driven re-rating. Investors may wish to track the Oswego restart timeline, TC/RC spread movements in copper, and execution on the company’s aggressive capex pipeline over the coming quarters.
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