Hindalco profit up for first time in 3 quarters
MUMBAI:ADITYA Birla Group company Hindalco Industries Ltd’s net profit rose for the first time in three quarters as it witnessed strong recovery in demand across businesses in India.
Net profit increased 17.7% to ₹377 crore during the quarter ended December from ₹321 crore in the same period a year earlier. These numbers came “after considering a provision of ₹115 crore, based on a judgement of the Supreme Court on mining regulations”, said the company.
Hindalco’s profit had fallen 1.5% and 10% during the June and September quarters, respectively. Revenue from operations, which produces aluminium, copper products and fertilisers, rose 11% to ₹11,023 crore.
Ebitda (earnings before interest, tax, depreciation and amortisation) grew 15% to ₹1,611 crore despite a rise in input costs, which are at an all-time high, according to managing director Satish Pai. He, however, expects a moderation in input costs in the coming quarters if crude oil prices correct. Another risk, according to him, is the oversupply in the domestic market that has been caused by a capacity ramp-up by rivals such as Vedanta Ltd.
“It is a combination of both supply and demand. Vedanta is ramping up. Nalco talks of putting up new capacity... Plus you have so much scrap coming in. If aluminium demand stays at 10% then it is not a concern. If it does not grow, we will all be fighting to export the rest,” said Pai.
“The good part is that the demand has started to pick up. June, July, August were very bad. January has been good. Let us see how February goes. We have been going through a down cycle. In Q2, GDP growth was lowest in 13 quarters but now it has picked up. I think we had hit the bottom and now have started to pick up,” he added.
Revenue from the aluminium segment rose to ₹5,323 crore in the December quarter from ₹4,917 crore.