Hindalco Q2 PAT seen up 22% at Rs 529 cr

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Aditya Birla group's flagship company Hindalco Industries has reported a standalone profit after tax of Rs 529 crore in the second quarter of FY12, a growth of 22% as compared to Rs 433.8 crore in the corresponding quarter of last fiscal.

Net sales are seen going up 5% to Rs 6,125 crore from Rs 5,859.9 crore during the same period.

EBITDA is likely to go up 17% to Rs 749 crore in July-September quarter of FY12 versus Rs 641.22 crore in a year ago period.       

EBITDA margin is expected to be at 12.2% versus 10.9% year-on-year.

On quarter-on-quarter basis, net sales of the company are likely to go up 2% while PAT is seen going down 18%.

Factors to watch:

Volumes:

Aluminum volumes likely to increase 3% QoQ but copper volumes are likely to be flat QoQ

Copper: Bi-annual shutdown at one of the smelters at Dahej of plant in the early part of the quarter is likely to dampen the copper volumes

Aluminum: Likely to report a steady improvement in aluminum volumes, sequentially, due to complete stabilization of its smelter after the outage

Flattish volumes QoQ both in copper (88kt) and aluminum (140kt) segments

Aluminium and copper prices have declined around 7.5% and around 2% QoQ respectively

Hindalco will benefit from (YoY) higher LME prices

But fuel costs have also risen and higher energy cost will hurt company sequentially

Also expect full impact of higher coal costs to kick in this quarter

Input cost escalations and sequentially fall in LME prices will weigh on the aluminum segment performance but will be partly negated by increased aluminum deliveries

Copper segment performance to be driven by TC/RC margins and should come in at 13c/lb around the same level as Sterlite reported

Product mix will also be keenly watched (Aluminum contributes 35% and copper contributes 65% to the revenues))

PAT was boosted by other income in 1QFY12:
-Other income included Rs 69 crore of dividend received from ABML ((Aditya Birla Minerals Ltd, the company's Australian subsidiary)) and is unlikely to recur in 2QFY12

Also other income was higher by Rs 109 crore driven by improved treasury yield and an enhanced corpus, consequent to return of capital from Novelis