Hindalco Industries shares fall 4%; Reliance Securities says avoid, CLSA maintains buy

Hindalco Industries share price was down over 4 percent in the morning session on September 24 with the metal index shedding over 2 percent.

Global research firm CLSA has maintained a buy on the stock with a target of Rs 225 per share. It is of the view that the correction in the stock is unwarranted given the resilient earnings outlook, according to a CNBC-TV18 report.

The firm believes that attractive product mix and strong scrap spreads will drive Novelis' earnings adding that beverage can demand remains robust across regions.

The stock was trading at Rs 159.70, down Rs 5.75, or 3.48 percent. It has touched an intraday high of Rs 161.10 and an intraday low of Rs 155.

Vikas Jain, Senior Research Analyst at Reliance Securities suggests avoiding the stock and has a target of Rs 140 per share. The stock saw resistance near its 34-month average and witnessed sharp profit-booking from the recent high of Rs 200 levels.

Hindalco is on the verge of breaking its long-term moving average and would continue to underperform in the short-term. Any bounce near to Rs 175-180 levels would be a good point for exiting long positions, he added.

According to Moneycontrol SWOT Analysis powered by Trendlyne, the company in the recent results have shown declining operating profit margin and net profits (YoY).

Moneycontrol technical rating is very bearish with moving averages and technical indicators being bearish.