Hindalco Stumbles as Novelis Postpones Highly-Anticipated US IPO Amid Market Jitters

Novelis, Hindalco's US unit, delays its US IPO due to market conditions, causing Hindalco's stock to fall 6%. Hindalco's strong performance and growth in Indian business have prompted a positive stance.

Hindalco’s US subsidiary Novelis postpones its IPO due to market conditions, leading to a 6% drop in Hindalco’s share price. The IPO was expected to raise up to $945 million, with Hindalco as the sole selling shareholder. 

Novelis, the world’s largest aluminum recycler, had set an IPO price range of $18-$21 per share. The offering was aimed at listing Novelis shares on the US stock markets, with Hindalco expected to retain a 92.5% stake post-listing. The valuation of Hindalco’s stake in Novelis and the utilization of the IPO proceeds are being closely watched.

The postponement of the Novelis IPO comes amid challenging market conditions, as investors remain cautious about new offerings. However, investors believe Hindalco’s fundamentals remain strong, with improved performance and expected gains in its India business due to higher LME prices.

The Novelis IPO was set to be the biggest by an Indian company in the US. The postponement is a setback, but investors remain optimistic about Hindalco’s long-term prospects, citing its improved performance and the potential gains in its India operations.

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