Hindalco Q1 net profit doubles


Hindalco Industries Ltd., a unit of the Aditya Birla group, more than doubled its net profit for the quarter ended June to Rs 734 crore, from a year earlier, helped by lower finance costs.

Revenue for the quarter was Rs 10,670 crore. The aluminium maker achieved the highest-ever quarterly earnings before interest, tax, depreciation and amortisation (Ebitda) of Rs 1,951 crore, which grew 17% on the back of ‘supportive macro environment, better operations and higher by-product realisation in the copper business’.

Interest expense drops

This was despite increase in the input costs, mainly for coal and furnace oil. Interest expense declined by 23% to Rs 464 crore, mainly on account of repricing of long-term project loans and repayments made in the last year. “The macro economic environment in the quarter was good,” Satish Pai, MD, Hindalco, said in an interview. “We ran a good operation and kept tight control on costs. This helped us double the net profit,” he added.

Pai said barring a threat from massive imports, the demand situation looked promising and the company would fare better in the coming quarters.

During the quarter, the company’s aluminium revenue stood at Rs 5,667 crore. Ebitda was Rs 1,531 crore in the first quarter, rising 35% on the back of better realisations and stable plant operations.

Revenue from the copper segment stood at Rs 5,006 crore in the quarter, compared with Rs 5,403 crore in the year earlier period.

The business was impacted by lower volumes on account of a planned maintenance shutdown in the quarter at one of the smelters.

Novelis buoyed by prices

Novelis’s revenue grew 16% to $3.1 billion, spurred by higher average aluminium prices, higher shipments and a better product mix.

The total shipments of flat rolled products rose 2% to 797 Kt. The key growth stimulants were higher automotive sheet shipments, operating efficiencies, with higher recycled contents and better cost management, the company said.

Net income at the Novelis business rose 36% to $137 million in the quarter.

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