04 DECEMBER 2015www.economictimes.indiatimes.com
Centrum Broking expects aluminium prices to recover
Edited by : AL CIRCLE
1 min read
Centrum Broking expects aluminium prices to recover next year as over supply in the world market tapers off with China and global aluminium majors cutting back on production in the last few months.
The brokerage said the recovery in prices will be based on actual fundamentals rather than speculation this time. It expects global demand to outstrip supply by 0.3 million tonne in 2016.
"We expect deficit in aluminium to return in 2016 and pave way for smart recovery in prices as fundamentals, rather than speculation or financial activity, increase in salience for determining prices. Hindalco Industries is our preferred play on an aluminium price recovery," the report said.
Centrum maintained its buy on Hindalco, Vedanta and Hindustan Zinc. It said sharp under-performance of non-ferrous stocks has led valuations compressing to lowest since the economic crisis of 2009 despite much better overall positioning of companies, with capex cycle behind and well-invested assets ready to deliver cash flow.
Hindalco stock has lost half its value in the past one year. It closed at INR 79.25 apiece, down 1 percent on BSE on Thursday, december 3rd.
The brokerage said the recovery in prices will be based on actual fundamentals rather than speculation this time. It expects global demand to outstrip supply by 0.3 million tonne in 2016.
"We expect deficit in aluminium to return in 2016 and pave way for smart recovery in prices as fundamentals, rather than speculation or financial activity, increase in salience for determining prices. Hindalco Industries is our preferred play on an aluminium price recovery," the report said.
Centrum maintained its buy on Hindalco, Vedanta and Hindustan Zinc. It said sharp under-performance of non-ferrous stocks has led valuations compressing to lowest since the economic crisis of 2009 despite much better overall positioning of companies, with capex cycle behind and well-invested assets ready to deliver cash flow.
Hindalco stock has lost half its value in the past one year. It closed at INR 79.25 apiece, down 1 percent on BSE on Thursday, december 3rd.
Unlock full access – sign up for FREE.
Key benefits
Find exclusive data-driven insights and in-depth analysis
Get our daily newsletter delivered straight to your inbox
Access real-time and historical price trends from global indices
Post and respond to latest business leads
Stay ahead with alerts on learning tools
...and so much more!SIGN UP / LOGIN
Previous article
IPPI declines in Canada while the U.S. aluminium demand and cosumption stay strong
Next articleNorsk Hydro to cut costs to cope with aluminium price slide
Grow with
AL Circle
