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Hindalco Industries, an Aditya Birla group company, has reported that its December quarter consolidated net profit was down 24 per cent to Rs 1,062 crore against Rs 1,394 crore logged in same period last year on the back of lower aluminum and copper prices.
Revenue was down 12 per cent at Rs 29,197 crore (Rs 33,213 crore).
Ebitda dipped 10 per cent to Rs 3,676 crore (Rs 4,080 crore).
Satish Pai, Managing Director, Hindalco Industries said domestic aluminum demand was the lowest ever in December quarter and fell by five per cent so far this fiscal.
However, he said greenshoots were quite visible from December on pick up in demand from power projects and expectations are that the March quarter would be much better.
Though demand in first three quarter of this fiscal was down four per cent, the industry may register a faltish growth this fiscal.
Aluminum LME prices have already been impacted by Corona virus and has fallen to $1720 a tonne from $1800 logged before the virus attack. The recovery in prices would depend on how fast production in China recovers, he said.
With signs of recovery in domestic demand the company expects to sell 60 per cent of production in India and export the rest, in contrast to the current trend.
Hindalco plans to invest Rs 2,000 crore next fiscal largely on downstream projects and Rs 800 crore in annual maintenance spend. The company has spent Rs 1,400 crore in capex so far this fiscal and plans to invest another Rs 400 crore in March quarter.
The company was not impacted much by the virus attack in China as it has only 60,000 tonnes of annual production capacity through its subsidiary Novelis and it has already started production there last Monday.
However, he said there could be some impact on supply chain and overall demand as China accounts for half of global aluminum and copper demand and production.
On the prolong delay in $2.7 billion acquisition of Aleris by Novelis, Pai said the US court arbitration order is expected by March while China has already given its approval for the deal.
The European Commission has sought more time to review Sanjeev Gupta-owned Liberty House Group bid to buy Aleris’ plant in Duffel, Belgium.
Initially, Novelis had plan to close Aleris buyout by January 21 but it now working without any deadline for the deal.
The closure of Aleris acquisition now hinges on Liberty House deal in Europe and US court arbitration verdict, said Pai.
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