BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
Hindalco Industries Ltd.’s Q1 FY22 result for the India business was strong, as expected, with Ebitda up 29% QoQ to Rs 24.3 billion on higher London Metal Exchange prices.
Consolidated net debt increased by Rs 45 billion QoQ to Rs 519 billion, and net debt/Ebitda declined to 2.36 times (versus a peak of four times after the Aleris acquisition).
We maintain our estimates and reiterate Hindalco as our top non-ferrous pick.
Despite rising costs, we estimate India Ebitda/tonne in FY22E to be the highest ever in the last 10 years at $959/tonne.
We expect 43% earnings per share compound annual growth rate over FY21-23E, led by stronger LME price and lower interest cost from deleveraging.
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