Hindalco Industries, an Aditya Birla Group company, has reported that its net profit was down four per cent at Rs 434 crore (Rs 451 crore) due to disruption of production at its plant in Hirakud and Renukut during the first two months of the December quarter.

Net sales were up three per cent at Rs 6,872 crore (Rs 6,647 crore) on the back of higher price realisations.

The company registered other income of Rs 318 crore (Rs 92 crore) on account of higher returns from its investment and one-time write back of “certain items” valued at Rs 144 crore.

Revenue from aluminium business was down marginally at Rs 2,215 crore (Rs 2,236 crore) and that of copper was up five per cent at Rs 4,660 crore (Rs 4,418 crore).

Metals impact

Alumina production was lower at 326,000 tonnes due to lower availability of bauxite.

D. Bhattacharya, Managing Director, said the company managed to mitigate the impact of higher operational cost as aluminium prices on London Metal Exchange improved four per cent year-on-year. While the treatment and refining charges in copper increased marginally, the lower acid and fertiliser (by-products) prices had its impact on earnings.

Cheaper imports from China have emerged a key challenge in aluminium value added products. However, some of the units in China are shutting down due to rising cost and power shortage, he said.

Finance cost more than doubled to Rs 169 crore (Rs 79 crore) due to draw down of $100 million from Export Development Canada for the Mahan Aluminium project. The company’s gross debt stands at Rs 20,000 crore. With a cash balance of Rs 8,000 crore, the net debt works out to Rs 12,000 crore.

Hindalco expects to start alumina production at its 1.5 million-tonne a year Utkal plant in April. Alumina will be converted into aluminium in Mahan, which will also go on stream in April.

Mahan will consume about 750,000 tonnes a year. The excess production of alumina will find many takers in the open market, he said. Aditya Aluminium will be commissioned by August.

Shares of the company were down three per cent at Rs 110 on Friday.

suresh.iyengar@thehindu.co.in

(This article was published on February 8, 2013)
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