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Hindalco Q1 preview | Net profit to surge 20% on-year on elevated aluminium prices

On a sequential basis, however, the performance of Hindalco’s standalone business is expected to take a sharp knock

Mumbai / August 10, 2022 / 10:40 AM IST
 
 
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Hindalco Industries Limited is expected to report a sturdy performance on a standalone basis for the quarter ended June aided by elevated pricing for aluminium products.

The commodity producer will report its June quarter earnings on August 10.

The company is likely to report a 20.3 percent year-on-year (YoY) growth in net profit to Rs 1,247 crore for the quarter ended June, according to a Moneycontrol poll of analysts. The aluminium and copper producer’s revenues from operations is likely to surge 34 percent YoY to Rs 17,894 crore for the reported quarter.

Similar strength is expected in the company’s consolidated earnings for the quarter on a YoY basis. Consolidated net profit is likely to come in at Rs 2,748 crore to Rs 3,340 crore for the June quarter with net sales of Rs 52,989 crore to Rs 55,106 crore.

The consolidated performance is likely to be driven by arm Novelis Corporation’s strong performance for the June quarter. Novelis Corporation reported a 32 percent on-year rise in revenues to $5.1 billion while the company’s net profit rose 28 percent on-year to $307 million.

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On a sequential basis, however, the performance of Hindalco’s standalone business is expected to take a sharp knock because of the sharp decline in domestic prices of the alloy. The company’s standalone net profit is likely to plunge 38 percent on-quarter while the topline may shrink by 9 percent.

Brokerage firm Dolat Capital Markets said that Hindalco likely saw a 5 percent sequential decline in volumes during the quarter. Copper volumes also likely fell 9 percent on-quarter to 96,000 tonnes in the June quarter.

On the operating front, the impact of lower prices will be felt acutely as operating profit for the June quarter may sink 35 percent on-quarter to Rs 2,623 crore. Brokerage firm Axis Securities said that the sequential weakness in operating profit for Hindalco Industries is due to lower sales realization even as energy prices remained elevated.

At 10:25 am, shares of Hindalco were down 0.2 percent at Rs 420.5 on the National Stock Exchange.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Chiranjivi Chakraborty
first published: Aug 10, 2022 10:40 am
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