Technical Bits: Hindalco breaks out of downward channel

The stock of Aditya Birla Group controlled entity, Hindalco Industries broke out of the downward channel decisively on Wednesday. The stock has been trading above its crucial short-term moving averages, i.e. 20 and 50-day moving averages.

The stock's Relative Strength Index (RSI) has reached its highest value in the last 14-days, which is bullish. Also, it has managed to close above the 60 mark after a span of almost four months. MACD reached above zero line and MACD line is above the signal line for the past 16 bars.

Hindalco has strong support in the zone of Rs. 200-201, while on the higher the 100 and 200-day moving averages are placed at Rs. 212.60 and Rs. 220, which are likely to act as an immediate hurdle.

For the recent quarter Q3FY19, the company reported consolidated EBITDA of Rs. 1,926 crore as against Rs. 1,861 crore in Q3 FY18, up 4 per cent on account of supporting macros and better realization, despite rising input costs. PAT was at Rs. 713 crore as against Rs. 484 crore in Q3FY18, up 47 per cent. The company also managed to significantly reduce its interest cost, which was at 12 per cent YoY, through prepayment of loans. The company focuses on deleveraging and prepaid long-term loan of Rs. 1,575 crore in October 2018.

On Friday, in the morning session, the stock of Hindalco was trading at Rs. 208.80 per share, higher by 0.84 per cent on the NSE. The stock is opened at Rs 208.10 and registered an intraday high of Rs. 211.55 per share.