Hindalco Industries Q2 profit dips 11% on one-time provisioning

Our Bureau Mumbai | Updated on January 09, 2018

Satish Pai, MD, Hindalco

Hindalco Industries, an Aditya Birla Group company, said its net profit in the September quarter fell 11 per cent to ₹393 crore, against ₹440 crore in same period last year, due to one-time provisioning of ₹106 crore.

Its revenue was up eight per cent at ₹10,308 crore, against ₹9,562 crore in the year-ago period.

The company has prepaid debt of ₹1,133 crore at Aditya Aluminium and ₹2,280 crore at Utkal Alumina during the September quarter. It has overall pre-paid debt of ₹7,966 crore in the first six months of this fiscal. Its net debt stands at ₹18,605 crore while that of its US subsidiary Novelis is at $3.94 billion. The company has made a provision of ₹106 crore based on various judgment passed by the Supreme Court on mining and value-added tax.

Satish Pai, Managing Director, Hindalco Industries, told BusinessLine the company managed to post best-ever EBIDTA despite demand for aluminium growing just two per cent in the first half of this fiscal and that of copper remaining flat.

“We are expecting aluminium demand to grow by double digit in the second half aided by power and real estate sectors while copper growth should be around three per cent,” he said. Revenue from aluminium sale was up six per cent at ₹5,213 crore, though production increased by two per cent to 3.26 lakh tonnes. Alumina output was down two per cent at 7.12 lakh tonnes. Value-added aluminium wire rod production was down 2 per cent at 1.19 lakh tonnes due to lower demand. However, aluminium EBIDTA was up 18 per cent at ₹957 crore on higher volumes and tight control on cost.

Copper production was lower by 10 per cent at 96,000 tonnes due to operational issues while copper cathode rod output was down seven per cent at 39,000 tonnes, mainly due to subdued demand.

However, revenue from copper business was up 10 per cent at ₹5,097 crore, driven by higher realisation. EBITDA soared 28 per cent to ₹467 crore consequent to higher by-product realisation.

Novelis sales increased 18 per cent to $2.8 billion supported by record quarterly shipment of 8.02 lakh tonnes, which is up 4 per cent.

Shares of Hindalco were down 0.61 per cent at ₹268 on Friday.

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Published on November 03, 2017
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