Motilal Oswal advises buying aluminium stocks on dips, Hindalco still top pick

what happened

According to TradingView, Siddhartha Khemka of Motilal Oswal believes the recent drop in aluminium prices creates an opening for long-term investors. Near-term pressure should persist because global supply is growing faster than expected, with smelters in West Asia restarting and output rising in China and Indonesia. He said prices have fallen from roughly $3,800 to nearly $3,000 per tonne, which has also dragged down producer shares.

The analyst remains positive on structural demand and on companies shifting toward value-added products. He recommends gradually building positions in quality stocks on weakness. Among aluminium companies, Motilal Oswal still prefers Hindalco, followed by Vedanta Aluminium.

why it matters

For primary aluminium producers, the price correction means thinner margins, so their share prices are sensitive to metal price moves. Companies expanding value-added output may be less exposed to swings in the primary metal price. For the market, the signal is that supply growth currently outpaces demand, although the analyst views structural demand as durable.

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