Hindalco shares have underperformed not just the Nifty50 but also the Nifty Metal Index in the last one year. It has declined 32.8% as against a 1.4% fall seen in Nifty50 and 13.06% in Nifty Metal, according to the data sourced from Trendlyne.
Nilesh Jain, Assistant Vice President (AVP), Equity Research Technical and Derivatives at Centrum Broking, has a buy call on this counter. He said that the stock is poised for a pull back towards Rs 420.
“Current trigger is the softening of the US dollar against a basket of major currencies. INR’s strength against the dollar is positive,” Jain said.
The rupee saw its best trading session in three weeks on Thursday, as Asian currencies firmed in anticipation that the US Federal Reserve was near the end of its rate hiking cycle, Reuters reported.
The rupee ended at 82.2625 per dollar on Thursday, compared with its previous close of 82.6550.
Brokerage firm Prabhudas Lilladher has recommended a buy on Hindalco with a stop loss of Rs 385 and a price target of Rs 320.Hindalco is a producer of aluminium and copper. Its products are used in several industries ranging from automobiles to packaging and pharmaceuticals.
The stock ended with gains on Thursday at Rs 398.60, up Rs 5.85 or 1.49%. The stock has rallied over the past four trading sessions.
It is currently trading at a price-to-book value of 1.14 while its trailing twelve-month Price-to-Earning ratio is 7.8, the Trendlyne data further said.
Momentum indicators RSI and MFI are in the medium range of 38.4 and 58.1, respectively. A number below 30 is considered as oversold while above 70 is considered as overbought.
The average broker target on this stock according to Trendlyne is 521.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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