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The market expects much less from Hindalco than it has delivered before.
At today’s share price, buyers are assuming Hindalco grows about 0% a year, forever. Over the last ten years it actually grew about 12% a year. That is a big step down from its own record — in other words, that it stops growing altogether. Either the market can see a problem that the published accounts do not show yet, or it is expecting a slowdown that has not happened.
- How it is valued: Discounted cash flow.
- What the price assumes: 0% growth, against 12% the model takes from its own record.
- Ten-year record: Between FY2018 and FY2026, Hindalco's revenue went from ₹1,15,809 crore to ₹2,74,944 crore — it compounded at about 11% a year over 8 years.
- Biggest swing factor: Aluminium prices. Main risk: Metal price falls.
01An aluminium giant on two continents
Hindalco Industries, the Aditya Birla group's metals company, is one of the world's largest aluminium producers. In India it mines bauxite, refines alumina and smelts aluminium using its own power, and also runs a copper smelter and refinery at Dahej.
It bought Novelis in 2007. Novelis, headquartered in the US, is the world's largest maker of rolled aluminium products and recycler of aluminium, supplying beverage-can, car and aerospace makers. It accounts for most of Hindalco's revenue.
02What the market is assuming
Work backwards from today's share price and you can see what buyers are quietly taking for granted. Here is the growth that price implies for Hindalco, next to what the model assumes from the company's own record.
The further apart these two numbers are, the bigger the bet a buyer at today's price is making.
03Hindalco's record, in plain numbers
Between FY2018 and FY2026, Hindalco's revenue went from ₹1,15,809 crore to ₹2,74,944 crore — it compounded at about 11% a year over 8 years. Net profit grew from ₹6,083 crore to ₹13,391 crore, about 10% a year — roughly in step with revenue. In FY2026 it kept 4.9% of revenue as net profit — against a low of 2.6% in FY2021 and a high of 7.0% in FY2022. The latest year added 15.3% to revenue, well ahead of its own long-run pace.
Revenue and earnings per share in ₹, return on equity and leverage as ratios — all from the filed statements.
Revenue and net profit by year (₹ crore)
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2018 | 1,15,809 | 6,083 | 5.3% |
| FY2019 | 1,30,542 | 5,495 | 4.2% |
| FY2020 | 1,18,144 | 3,767 | 3.2% |
| FY2021 | 1,31,985 | 3,483 | 2.6% |
| FY2022 | 1,95,059 | 13,730 | 7.0% |
| FY2023 | 2,23,202 | 10,097 | 4.5% |
| FY2024 | 2,15,962 | 10,155 | 4.7% |
| FY2025 | 2,38,496 | 16,002 | 6.7% |
| FY2026 | 2,74,944 | 13,391 | 4.9% |
04How Hindalco gets valued — and why
Discounted cash flowThis business is valued on the cash it is expected to generate, discounted back at its cost of capital — with growth taken from its own ten-year record rather than from guidance.
05What decides Hindalco's value
Aluminium prices
Global prices swing Indian smelting profits.
Novelis spreads
Novelis earns a conversion margin, less exposed to metal prices.
Captive inputs
Own bauxite and power keep Indian costs low.
Capex
Large expansions at Novelis and in India need to earn their cost.
06What could go wrong
- Metal price falls. Weak aluminium prices hit Indian profits.
- Novelis execution. Big US projects have run over budget.
- Trade policy. Tariffs and duties affect metal flows.
07What the full Hindalco valuation shows
Sign in free to see the complete Hindalco valuation
- ✓Fair value per share — from a ten-year discounted cash flow, every step shown
- ✓The Workbench — change revenue growth, the discount rate or terminal growth and watch Hindalco's value move
- ✓Bull, base and bear cases — and exactly which assumptions move between them
- ✓Peer comparison — against Vedanta, Tata Steel and JSW Steel
- ✓Downloadable report — the full write-up, yours to keep
08Compare Hindalco with peers
The same valuation, run side by side.
Hindalco vs VedantaAluminium and copper against a diversified metals-and-resources group.→Hindalco vs Tata SteelNon-ferrous against steel, on the same commodity cycle.→Hindalco vs JSW SteelTwo metals majors judged on where the cycle sits.→09Questions people ask about Hindalco
What is Novelis?
Hindalco's US-based subsidiary, the world's largest maker of rolled aluminium and recycler of aluminium, bought in 2007.
Why are Hindalco's Indian margins high?
It controls its own bauxite and power, two of the biggest costs in aluminium.
Hindalco or Vedanta — which is better value?
Two metals majors, compared side by side on their own page.
Is Hindalco overvalued?
At ₹944 the market is pricing in roughly 0% sustained growth, against the ~12% its own record supports. That is less than it has delivered — on these numbers the market is asking the business for less than its own record, which usually means it doubts the record repeats.
What is the intrinsic value of Hindalco?
It is computed from the filed financial statements using the method that fits this business (discounted cash flow), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
How much debt does Hindalco carry?
Debt to equity stands at 0.55, against 0.53 at the start of the period — the balance sheet is a core input to the cost of capital used here.