Prysmian falls on aluminium shortage fears over Hormuz closure

(Il Sole 24 Ore Radiocor) - Concerns over aluminium shortages are weighing on the Prysmian stock at Piazza Affari, where the company's shares are the worst performing among blue chips. As summarised by the Sole 24 Ore, due to the closure of the Strait of Hormuz, on the aluminium market "the situation is precipitating" and "many analysts now foresee not only increasing price rises but also supply shortages that risk lasting for years". According to Citi analysts, in particular, 'the damage is largely already done' for what is shaping up to be 'one of the largest supply shocks in modern history, certainly since at least the 1970s'.

Prices, the newspaper notes, 'this week updatedfour-year highs at the London Metal Exchange, at $3,707.5 per tonne', approaching the all-time high of $4,073.5, reached after the Russian invasion of Ukraine.

Banca Akros analysts thus confirm their 'reduce' rating on Prysmian, with a target price of €110, noting that "aluminium cables are used to connect data centres to high and medium voltage networks". In particular in the data centre industry, crucial for the development of artificial intelligence, "aluminium cables are preferred to copper ones because of their lower cost, structural lightness and better heat dissipation".

From the company, however, they throw water on the fire, denying concerns about the aluminium shortage. 'We do not see any impact, we are well prepared and well protected,' says a spokesman. The market movement, after all, is also linked to technical adjustments at the end of the month, and since the beginning of May Prysmian's share price has still advanced more than 18%.