JPM-JPM Mining Daily Iron ore -百分之2.5, NdPr Oxide 百分之2.1...-20251110

India business delivers a slight beat; aluminum upstream phase 2 expansion announced

We are updating our Hindalco model post 2QFY26 consolidated earnings and management commentary. Hindalco’s India business segment EBITDA came in 3% ahead of JPMe driven by slightly better upstream/downstream Aluminum EBITDA per ton of $1,521/$265 (JPMe $1,500/t and $250/t). Copper EBITDA was marginally below JPMe (Rs6.34bn vs. JPMe Rs6.58bn) but in line with guidance. Hindalco announced the second phase of Aditya aluminum expansion (193kt) at a project cost of Rs102bn. Consolidated net debt to EBITDA moved slightly higher to 1.23x (vs. 1Q 1.02x) and the company expects leverage ratios to stay <2x during the ongoing phases of capacity expansion. A notable takeaway was that Hindalco is now hedged at around 49% in 4QFY26 at LME $2,760/t (vs. spot $2,835/t; JPM commodities research team forecast of $3,000/t in 1QCY26). Our FY26 EBITDA is revised slightly higher while our FY27-28E EBITDA is unchanged. See our earlier note post Novelis results here. Our PT remains unchanged at Rs810.