Hindalco Industries Q4 Preview: PAT may rise by up to 55% YoY, revenue to jump 12% on higher alumina prices

Hindalco Industries will announce its Q4FY25 earnings on Tuesday and the company is expected to report a net profit growth in a wide range of 25%-55% according to estimates given by four brokerages. The bottomline could fall between Rs 3,956 crore and Rs 5,520 crore.

The Aditya Birla Group Company could post a revenue uptick between 4% and 12%, the estimates revealed, which translates into a topline between Rs 58,278 crore and Rs 62,960 crore. The revenue will grow on higher aluminium and alumina prices.

The estimates of Axis Securities, Nuvama Institutional Equities, Yes Securities and ICICI Securities have been taken into account.

The most conservative PAT estimates are from Yes while Nuvama has the most bullish figures among its peers. As for revenue, Yes has the lowest estimates and Axis the highest.

Here’s what brokerages recommend:

Axis Securities

Axis Securities expects Hindalco Industries to report a strong performance for the quarter, with its PAT rising 29% YoY to Rs 4,098 crore, and up 10% on a sequential basis. The company’s revenue for the quarter could come in at Rs 62,960 crore, marking a 12% YoY growth and an 8% increase compared to the previous quarter.

The consolidated revenue uptick will be led by higher aluminium and alumina prices.

Company’s Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) could rise 16.8% YoY to Rs 7,985 crore, though sequential growth was a more moderate 5.1%. The EBITDA margin may stand at 12.7%, an improvement of 47 bps YoY but saw a slight contraction of 33 bps quarter-on-quarter.

Novelis, Hindalco’s US-based subsidiary, could report EBITDA per tonne at $480, reflecting a decline of 11.2% YoY, though there was a strong 18.3% QoQ recovery.

“We assume slightly lower Aluminium sales YoY and nearly flat QoQ. Novelis shipments are likely to pose a seasonal recovery in shipments over the impacted base of Q3FY25; we expect it to remain slightly lower YoY. We assume a drop in copper sales volume YoY and recovery on a QoQ basis,” Axis said in a preview note.

Average LME Aluminium prices inched up by 19% and 2% YoY and QoQ. Average Alumina prices stood robust at $523/t, but have cooled off QoQ, down 24% QoQ, but still up 44% YoY due to the lingering impact of supply issues.

Nuvama Equities

Hindalco’s adjusted PAT is seen at Rs 5,520 crore, marking a sharp 55% YoY growth and a 46% rise on a sequential basis. Revenue for the quarter may stand at Rs 62,060 crore, likely up 11% YoY and 6% QoQ.

The company’s EBITDA may also witness a significant jump, rising 36% YoY and 20% QoQ to Rs 9,110 crore.

India EBITDA is likely to increase 9% QoQ to Rs 5,050 crore, this brokerage said, adding that aluminium, including Utkal Alumina, EBITDA is expected to rise 9.5% QoQ to Rs 4,700 crore supported by higher aluminium prices (up 2.1% QoQ), favourable exchange rate and better volumes (+2% QoQ).

However, copper EBITDA is likely to be lower at Rs 700 crore, down 10% QoQ.

Novelis’s adjusted EBITDA/t is likely to recover 21% QoQ to $490 supported by higher volume, better product mix and beverage packaging contracts at higher prices.

Yes Securities

Yes has pegged the PAT growth at 25% YoY and 6% QoQ to Rs 3,956 crore for the quarter under review. The brokerage sees net sales at Rs 58,278 crore, gaining 4% YoY while falling by 0.2% QoQ.

Yes has a buy recommendation on the Hindaco Industries shares for a target Rs 732.

“We expect Hindalco to report a revenue of 582 billion, down 0.2% QoQ and up 4.1% YoY due to strong LME aluminium prices and improvements in the Novelis business. On the EBITDA level, we expect the company to report an EBITDA of Rs 75,200 crore, down 0.7% QoQ and up 12.7% YoY.

ICICI Securities

ICICI Securities has estimated Hindalco Industries’ PAT at Rs 4,167 crore, reflecting a 31% YoY growth and a 12% increase on a sequential basis. The company's consolidated revenue may stand at Rs 61,046 crore, likely rising by 9% YoY and 5% QoQ.

Operating profit, measured by EBITDA, may come in at Rs 8,178 crore, registering a 22% YoY growth and an 8% rise QoQ.

“Downstream Al division is likely to perform better led by better traction. Upstream EBITDA impacted lower Alumina prices QoQ. Expect Novelis EBITDA/te at Rs 493/te,” this brokerage said.

Hindalco has a buy view on the counter for a price target of Rs 765.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)