Alucina comes from the verb alucinar, which means to hallucinate, but in a more colloquial sense, it can also mean to be amazed, to be blown away, or to be driven crazy by something.
In this song, Gusttavo Lima uses it to express the intense, almost overwhelming effect his passion has on him. He sings, "Essa paixão que me alucina" (This passion that makes me hallucinate/drives me crazy), conveying a feeling of being completely consumed and mesmerized by his love.
Gusttavo Lima builds this one around a single chase: he keeps trying to grab hold of someone who keeps pulling back and then leaning in anyway. The chorus says it plainly, "Eu vou tentando te agarrar" [I'm going to try to grab you], while she tells him "chega pra cá" [get here] and then shows up smiling regardless, so the resistance and the surrender happen in the same two lines.
The verses explain how sudden it was. "Foi de repente" [It was all of a sudden], he sings, "Em um segundo você invadiu meu mundo" [In a second you invaded my world], and there's no fight left in him by the next line: "E eu me entreguei" [And I gave myself up]. By the bridge he's stopped trying to sound composed about it, just "Estou completamente apaixonado por você" [I'm completely in love with you], describing a passion that "me domina" [dominates me] and "me alucina" [hallucinates me]. It's one hook sung at full volume for three minutes straight, and for a song about losing control, that repetition fits.