Business Daily from THE HINDU group of publications
Sunday, Nov 01, 2009
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Business Daily from THE HINDU group of publications Sunday, Nov 01, 2009 ePaper | Mobile/PDA Version | Audio | Blogs |
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Corporate
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Financial Performance Corporate Results - Aluminium
Our Bureau Mumbai, Oct. 31 Hindalco Industries’ net profit more than halved to Rs 344 crore in the second quarter ended September 30 against Rs 720 crore logged in the same period last year. Net sales fell 13 per cent to Rs 4,917 crore (Rs 5,683 crore) on the back of the sharp fall in aluminium and copper prices on the London Metal Exchange (LME). The decline in realisation would have been much sharper if not for the rupee depreciation against the dollar. Of the total revenues of Rs 4,917 crore, aluminium business contributed Rs 1,650 crore with an EBIT (earnings before interest and tax) of Rs 259 crore. The 35 per cent fall in the LME over Q2 FY09 levels dented both the top line and the bottom-line. Lower sales realisations from aluminium business accounted for the near Rs 550-crore drop in the operating profit. These macro-economic factors led to a 64 per cent drop in the profit before interest and tax for aluminium business from Rs 715 crore in the comparative quarter last year, the company said in a press release. In the copper business, revenues declined eight per cent to Rs 3,269 crore mainly on account of lower copper LME. Copper being a custom smelting operation with offset hedging programme is relatively insulated from the vagaries of volatile commodity prices. However, lower by-product credit has dented the EBIT by Rs 350 crore. Signs of recovery in aluminiumWorldwide aluminium production continues to exceed consumption, although in the last few months consumption has been rising faster than production. LME stocks in September moved down marginally to 4.59 million tonnes from a high of 4.62 million tonnes. Downstream demand in India has caught on considerably compared to the second half of the last financial year. The electrical and transportation sectors have done well while building and construction is showing signs of arrival. Consumer durables and packaging have continued on the high growth path. Copper prices have sustained their strength, aided by a brighter outlook on global economy and improved risk sentiment. However, rising exchange stocks and muted Chinese imports may cap further uptrend in prices. Following last year’s financial meltdown, delays in copper mining projects have led to tightness in the global concentrate market, resulting in depressed spot TcRc. Hindalco to raise Rs 2,900 cr Hindalco to wrap up Utkal financial closure by Nov Lower prices pull Hindalco net down 31% More Stories on : Financial Performance | Aluminium | Hindalco Industries Ltd
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