Hindalco Intraday Buy Call

As per views of technical analyst Mathew Easow, investors can purchase Hindalco Industries stock on declines to achieve a short term between Rs 204-210.

The stop loss marked for the suggested stock is Rs 178.

Today (May 28), the company’s shares opened at Rs 187, as against its last closure at Rs 185.50 on Monday (May 27), on the Bombay Stock Exchange (BSE). Current EPS and P/E ratio stood at 18.94 and 10.14 respectively. The share price has seen a 52-week high of Rs 223.3 and a low of Rs 135 on BSE.

The stock has much potential to climb to the target price as the company has good growth prospects considering its projects under implementation and influential future plans.

Hindalco Industries reported a substantial rise in standalone net profit for the quarter ended March 2008, beating analysts` estimate by a wide margin. During the quarter, the profit of the company jumped 49.31% to Rs 10,770 million from Rs 7,213 million in the same quarter previous year. The analysts surveyed by Bloomberg forecasted Rs 6,427.61 million in earnings.

The company posted earnings of Rs 8.78 a share during the quarter, registering 25.43% growth over prior year period. The analysts had estimated Rs 5.66 a share.

However, the financials of the company also include contribution of Indian Aluminium Company, a subsidiary of the company, which was amalgamated with the company with effect from Apr. 1, 2007. Therefore, the figures of current quarter and year ended Mar. 31, 2008, are not comparable with those of the corresponding previous periods, the company said.    

Net sales for the quarter went up 5.50% over previous year period to Rs 50,102 million as against Rs 47,388.42 million forecasted by analysts. Total income for the quarter climbed 5.79% to Rs 51,544 million compared with the prior year period.

Other stocks from the same sector that looks good for short term trading includes NALCO, Guj Foils and India Foils.

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