BUZZ-UBS initiates India's Hindalco with 'Buy' on metal price optimism and Novelis turnaround

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** UBS initiates metals maker Hindalco HALC.NS with "Buy" and PT of 1,325 rupees

** Positive view is based on high metal prices, turnaround at its global subsidiary Novelis, and scheduled completion of key growth projects

** Brokerage expects Hindalco's upstream aluminium business to benefit from higher realizations and a structurally low cost base, with LME aluminium CMAL3 projected to remain above $3,000/tonne through FY27-29E, driving a 26% EBITDA CAGR over FY26-28E

** Forecasts significant improvement in Novelis operations following a challenging FY26, with volumes normalizing and margins expanding from $462/tonne in FY26 to $512-542/tonne in FY27-28E

** Says despite HALC's substantial capex pipeline, strong operating cash flow is expected to support deleveraging over the medium term

** Stock rated "Hold" on average by 30 analysts; median PT at 1,110.5 rupees - LSEG compiled data

** YTD, stock up 15.2% vs Nifty Metal .NIFTYMET index up 18.2%


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