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Invest in Hindalco Industries - With Long Term View

Hindalco Industries in recent years struggling with global meltdown in commodity price and impacted its fortune dearly. The meltdown in China, unrest in Middle East and recession in Europe impacted the global demand of Aluminum and Copper.

The meltdown in global economy impacted the global price of both the commodity and inturn inflicted on Hindalco Industries profitability.

Now  it seems that they are turning the table upside down. In last quarter, they reported 5 fold increase in profitability with lower than expected revenue. Basically revenue got impacted due to planned copper manufacturing center maintenance.

By improving the operational efficiency Hindalco Industries managed to save and hence successfully demonstrated their capabilities to maintain the profitable business.

As Indian economy is turning corner as well as USA economy is picking up; it is expected that commodity price is going to go up and the indication is already there will growing Coal price in the International market.

At the same time, HindalcoIndustries is also getting lots of support from global energy price and i am expecting that energy price will be subdued for next many quarter.

The share price jumped and gained more than 30% before retracting around 12%. I am expecting that Hindalco Industries share price is undervalued and will reach around 240 INR in next 14 to 16 month.  Value Investor may look into the company may start accumulating the share during market sell off as worst is over for Hindalco Industries.

I will not recommend investor to play in F&O market. I also recommend reader to consult their financial advisor before investing
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About Devendra Prasad

20 years plus industry veteran of domestic and international ICT domain with the expertise in Business, Technology, Strategy and Analysis. Specializes in forecasting impact analysis, trends and recommendations for Investments, Technology and Regulations.
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