HINDALCO INDUSTIRES A LONG TERM VIEW.

Target Price: Rs200Time Outline: 10Months

Reason for Recommendation 1: Hindalco Industries is one of Indias largest metal company and of the Aditya Birla Group, run by one of the worlds youngest billionaires, Mr. K.M. Birla. The company has annual sales of $ 2.19 billion and employs 13,675 people, with a total market value U$2.96 billion.

Reason for Recommendation 2: On February 11, 2007, the company acquired the Canadian company Novelis for U$6 billion, in all cash deal making itself the worlds largest rolled-aluminium producer. We recommend a Strong Buy and averaging this stock for those who have bought this already because the quarterly numbers were excellent and the company saw greater than 50% growth in all kinds of margins.

Reason for Recommendation 3: We believe the domestic demand story both for steel and for aluminum is very likely to grow and staying with the leader like Hindalco, you cannot go too wrong. Hindalco is listed on the Forbes Global 2000 list at the position 1821. Hindalco is trading at a PE Ratio of just about seven to eight times its latest numbers and it is just a matter of time before we could witnesss some very great value unlocking in this counter.

Reason for Recommendation 4: The company has a very long standing record of being an Investor friendly company.Sector Notes/Buoyancy: The metal industry is a key sector in the Indian economy as it meets the requirements of a wide range of important industries such as engineering, electrical and electronics, infrastructure,automobile and automobile components, packaging etc. The ongoing reforms in the power sector and focus on improving power infrastructure, is expected to further boost the aluminium sector in India has been achieving growth at a steady and sustained pace.Investment Risk Notes: The risk element stems from the possibility of rise in input costs, which may strain the margins. This is more so, as the buoyant trends in the commodity price cycle for caustic soda and chorine products are likely to persist.Conclusion: Strong BuyCompany Website: http://www.hindalco.net/