Shares of Hindalco Industries rose nearly 4 percent on Wednesday, rebounding from a weak start, as investors considered mixed brokerage perspectives regarding its subsidiary, Novelis. This interest comes despite Novelis reporting a fourth-quarter loss attributed to fire incidents at its Oswego plant in New York. Positive sentiment was driven by expectations for a quicker-than-anticipated restart at the facility, an improved outlook for free cash flow, and advancements on the Bay Minette expansion project.
The stock price increased to ₹1,089.50 from the previous close of ₹1,048.30, following an early trading low of ₹1,038.40.
Novelis, fully owned by Hindalco, posted a consolidated net loss of $84 million for the quarter ending March 31, 2026, a sharp decline from a net profit of $294 million during the same time last year. The company noted that this downturn was primarily due to $630 million in pre-tax losses resulting from fires at its Oswego facility. Despite the loss, consolidated net sales increased by 4 percent year-on-year to $4.79 billion from $4.59 billion, spurred by rising aluminum prices. However, the total rolled product shipments fell by 12 percent year-on-year to 844 kilotonnes, impacted by production disruptions at Oswego and reduced demand in specific specialty markets amid geopolitical uncertainty.
In terms of brokerage evaluations, HSBC maintained a “buy” rating on the stock with a target price of ₹1,310. The brokerage praised Novelis for its strong earnings performance and viewed the Oswego restart as a significant positive development. It noted that the Bay Minette project remains on schedule without notable cost increases and anticipates an improvement in underlying earnings in FY27 as production ramps up.
Citi, on the other hand, retained a “neutral” outlook for Hindalco with a target price of ₹1,000. The brokerage expects Novelis to achieve positive free cash flow by the fiscal year-end 2027 and acknowledged that the Oswego facility’s restart is progressing more rapidly than expected. It also pointed out that the Bay Minette expansion is nearing completion and that FY26 cost savings have exceeded management’s guidance.
Jefferies maintained a “hold” rating with a target price of ₹890, citing ongoing impacts from the Oswego fire on quarterly performance. The firm anticipates that the expected restart in the coming weeks should help stabilize operations but cautioned that insurance recoveries might temporarily affect the earnings trajectory, complicating assessments of the company’s recovery.
Domestic brokerage JM Financial stated that Novelis reported an adjusted EBITDA of $459 million in 4QFY26, surpassing its estimation of $356 million. However, it termed this overachievement as largely optical, attributing it to approximately $577 million of fire-related losses recorded below the EBITDA line. The brokerage also noted that EBITDA per tonne improved quarter-on-quarter to $544 from $430 in Q3, amidst operational roadblocks and soft demand in specialty products.
Moreover, JM Financial updated its estimate of the adverse free cash flow impact from Oswego to $1.7 billion, up from the previous estimate of $1.3 billion to $1.6 billion, with 70–75 percent expected to be recoverable through insurance. The brokerage continues to recommend a buy rating and indicated that commissioning for Bay Minette is on track for the second half of calendar year 2026, while Novelis forecasts a rebound in free cash flow by fiscal year-end 2027.
Published on May 20, 2026.
