DBT Bureau
Pune, 7 Jan 2026
Aluminium prices rebounded sharply in the previous session, settling 2.74% higher at ₹314.8, supported by improving investor sentiment amid early signs of economic stabilisation in China following Beijing’s targeted support for key sectors, according to Kedia Advisory. Sentiment was further boosted by China reiterating its intent to curb overcapacity in metal production to address deflationary pressures. With China expected to breach its 45-million-ton aluminium output cap this year, smelters are likely to restrain production growth in 2026, diverting capped supply towards domestic markets rather than exports, which led to a 9.2% year-on-year decline in aluminium exports in November. Global supply-side disruptions also lent support, as overseas expansion plans of Chinese smelters—particularly in Indonesia—face hurdles from high energy costs and regulatory challenges, while elevated power prices, equipment failures, bauxite sourcing issues and geopolitical risks have resulted in smelter suspensions across regions including Iceland, Mozambique and Australia. Inventory trends remained mixed, with SHFE stocks rising 1% while aluminium inventories at major Japanese ports declined 5.2% month-on-month. Technically, the market saw short covering, with open interest falling 1.54% to 3,908 contracts alongside an ₹8.4 price rise, even as global primary aluminium output edged up marginally in November and China’s production increased 2.5% year-on-year.
Against the backdrop of strengthening aluminium demand and tightening global supply dynamics, stocks of key Indian aluminium producers are expected to remain in focus. Companies to watch include National Aluminium Company (NALCO), Hindalco Industries, Vedanta Aluminium, Bharat Aluminium Company (BALCO), Jindal Aluminium, Maan Aluminium, Premier Aluminium, and Century Aluminium Manufacturing Company (India operations), as improving price momentum and demand outlook could support earnings visibility across the sector.
(Disclaimer: This information is for educational purposes only. Please consult your financial advisor before taking positions in stocks)
