India's Hindalco loses 2% on margin concerns after cut to growth capex

McEwen

05/04/2023 08:14

** Shares of Hindalco Industries  HALC.NS  fall as much as
2.05% to 394.30 rupees
    ** HALC announces cut to growth capex to $4.5 bln at its
annual investor day, to be spent over next five years, compared
to $7.9 bln announced a year ago 
    ** The reduction in growth capex is a sign of low confidence
in cashflows, says Kotak Institutional Equities in a note    
    ** Co's U.S.-based unit Novelis' growth projects are
deferred, not cancelled; will continue to weigh in on margins -
Kotak
    ** Lower earnings forecast in Novelis has pushed co to
allocate money meant for debt reduction to capex, says
PhillipCapital    
    ** Motilal Oswal says co adding downstream capacities at
right time to capture robust growth opportunities
    ** Both PhillipCapital and Motilal Oswal maintain their
"Buy" rating at a TP of 505 rupees and 510 rupees, respectively
    ** Kotak expects the uncertain outlook about Novelis’
earnings to keep the stock under pressure in the near term;
rates stock "Add" but trims target price to 455 rupees
    

 (Reporting by Aleef Jahan in Bengaluru)
 ((aleefjahan.cs@thomsonreuters.com))