Hindalco's Q3 net down 4% on higher finance cost

Moneycontrol Bureau

Hindalco Industries'  December quarter net profit fell 4% to Rs 434 crore, year-on-year on higher finance cost. The company's finance cost rose to Rs.169 crore from Rs 79 crore, YoY on account of greater average borrowings.

Sales of the company rose around 4% to Rs 6872 crore on higher volumes in copper businesses.

Copper business contributed Rs.4,660.84 crore to the overall income, which is 5% higher,YoY  Sequentially, it rose by 15% on the back of higher volumes. The remaining came in from aluminium business.

Post earnings announcement, shares of the company were marginally down to Rs 111.90. Did you read: Buy Hindalco 120 Call option at around Rs 3, says Sharma

The company said, with new projects going on-stream in near-term, the company is well poised to take the business to the next level.

Going ahead

The company's Renukoot and Hirakud smelters which were shut due to environmental concerns, have resumed operations. This development will help boost capacity.

The firm is in expansion mode with 359 ktpa (kilo tonnes per annum) Mahan Aluminium and Aditya Aluminium smelters and 1.5 million tonne per annum Utkal refinery are likely to be commissioned later this year.
Concerns pertaining to the performance of the company's US-based subsidiary Novelis seem to be easing out on better pricing. 

Last month, Hindalco acquired alumina refinery and bauxite mines in Brazil from Novelis as part of corporate re-organisation plan. This will allow the company, with its sole focus on mining and alumina business, to create value out of the moth-balled assets.