Hindalco’s sales cross ` 1 L-cr mark in 2014-15
Aluminium major’s sales grew 14% due to higher production at new plants, but interest costs dragged profit
MUMBAI: Hindalco Industries, the flagship company of the Aditya Birla group, on Thursday said its consolidated revenue crossed the ` 1 lakh-crore mark, while high interest costs and exceptional items brought down the net profit.
Managing director Debu Bhattacharya told HT that higher production from the company’s new assets led to increased sales which totaled
` 1,04,281 crore for the consolidated year ending March 31, 2015, compared to ` 87,695 crore last year.
“There are three reasons for the performance — new plants, ramped up production and asset sweating (increasing the yield from assets),” he said.
One of India’s largest aluminum and copper producers, Hindalco has seen aluminum sales grow 14% due to higher production at new plants — Mahan Aluminum and Aditya Aluminum. Copper sales grew by 5%.
Consolidated net profit, however, fell to ` 854 crore compared to ` 2,175 crore last year. “Interest costs were steep and were at
` 4,178 crore,” said Bhattacharya. Last year interest cost was at ` 2,702 crore.
Exceptional items that pulled down the consolidated net profit included impairment of fixed assets and write- down in the value of inventories, especially at overseas units.
Similar impairment of plants has been done by Tata Steel and Vedanta unit Cairn India, which affected their profitability.
The Hindalco board approved a proposal to recommend a dividend of ` 1 a share that would aggregate a payout of ` 246 crore.
On the outlook for the metals sector, Bhattacharya said the slowdown in China — the world’s largest producer of aluminum — implied that Chinese products would find their way into markets globally, bringing down the prices.
“But that phenomenon would be short-lived, two to three quarters at the maximum as markets have a way to maintain equilibrium.”
He said aluminium’s wide applications would ensure a strong outlook for the metal in the coming months.