Moneycontrol Bureau
Aluminium major Hindalco Industries' first quarter (April-June) profit beat analysts' expectations on Friday, rising nearly 5-fold (381.2 percent) year-on-year to Rs 294 crore. It was driven by better operational performance despite fall in revenue and higher tax cost.
Revenue during the quarter missed estimates, falling 11.4 percent to Rs 7,597.3 crore on yearly basis due to sharp decline in realisations.
"A 36 decline in copper volumes due to planned maintenance shutdown along with lower realisations, negated the impact of higher aluminium revenues," the company said.
Hindalco adjusted profit of the year-ago period at Rs 61.1 crore against reported profit of Rs 107.2 crore due to new accounting standards.
Profit was estimated at Rs 218 crore on revenue of Rs 8,650 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.
Despite the fall in realisations, aluminium business (which contributed 56 percent to total revenue) grew by 7.5 percent to Rs 4263 crore on strong volume growth. Segment's earnings before interest & tax (EBIT) climbed 63.9 percent.
"Strong operational performance in a challenging macroeconomic environment, efficiency gains and lower input cost helped deliver robust results in aluminium," the company said in its filing.
Revenue from its copper business in Q1 fell 27.7 percent to Rs 3,336 crore on lower production due to planned maintenance shutdown. EBIT also dropped 28.7 percent to Rs 283.7 crore on yearly basis.
Operational performance was far ahead of expectations. Operating profit grew by 34.9 percent to Rs 1,231.7 crore and margin expanded by 560 basis points to 16.2 percent compared with year-ago period. Analysts had estimated at Rs 960 crore and 11.1 percent for the quarter, respectively.
"Operational performance was also supported by deflationary energy prices," Hindalco said, adding the macroeconomic headwinds still persist and the uncertain global macro factors pose several challenges.
Power & fuel cost declined 9.7 percent YoY to Rs 1,485 crore and raw material cost fell 24 percent to Rs 3,973.2 crore in the quarter ended June 2016.
Other income during the quarter increased 30 percent to Rs 119.2 crore while finance cost fell 0.7 percent to Rs 599.57 crore on yearly basis. Tax expenses shot up significantly to Rs 118.9 crore from Rs 8.62 crore in same period.
At 13:28 hours IST, the scrip of Hindalco Industries was quoting at Rs 146.30, up Rs 4.05, or 2.85 percent on the BSE.Posted by Sunil Shankar Matkar
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