Hindalco Stock Falls 7% On Constellium Weak Performance

Following the release of Constellium SE's quarterly results, Hindalco's stock fell by about 7 per cent in the Thursday trading session. While, the shares of Constellium SE fell by a steep 28 per cent. 

As a result of floods at its Swiss operations and declining demand in certain end markets, Constellium declared reduced third-quarter earnings and revenue.

Constellium SE is a global manufacturer with headquarters in Paris that specialises in structural components composed of cutting-edge alloys, extruded goods, and rolled aluminium products. 
 

Due to subpar results in the automotive and aerospace industries, its shipments decreased in the third quarter.
 

Following the disappointing performance, Hindalco's subsidiary Novelis is facing more difficulties as Constellium SE, which is in the same market, reported weak demand in the automobile industry.

Since the automotive industry is Novelis' most lucrative, it accounts for 20 per cent of Hindalco's overall sales and a larger percentage of its EBITDA.

These worries caused Hindalco's stock to plummet, making it the Nifty 50's biggest loser. Although still in the red, Hindalco's shares traded at Rs 689 on the National Stock Exchange (NSE) NSE in the afternoon session, down from the day's low of Rs 666.75.

Additionally, the counter's trading volumes were significantly greater. Up to 87 lakh shares have exchanged hands thus far, which is a substantial amount more than the average of 64 lakh shares traded daily over a month.