Hindalco Q3 net profit rises 60% to Rs 3,735 crore, boosted by India business

Hindalco Q3 net profit rises 60% to Rs 3,735 crore, beats estimates

Hindalco Industries Ltd on February 13 reported a stronger-than-expected consolidated net profit of Rs 3,735 crore, marking a 60 percent increase, driven by robust performance in its Indian aluminum and copper businesses.The aluminium maker reported net profit of Rs 2,331 crore in the year-ago period.

Strong aluminium prices coupled with doubled digit growth in demand helped the world's largest aluminium producer achieve 'industry-leading' margins during the quarter in its upstream business.  "The Aluminium India Upstream business achieved record quarterly EBITDA, with industry-leading margins of 42%," said managing director Satish Pai. The results come as the company is raising its bets on the upstream business with hefty investments expected in the coming quarters.

The mining and metal major reported consolidated EBITDA of  Rs 8,108  crore in Q3FY25, up 28 per cent  YoY, the company said.

The Aditya Birla Group company posted 11 per cent  rise in consolidated revenue at Rs 58,390 crore in Q3FY25 as against Rs 52,808 crore in Q3FY24. According to estimates from 19 Bloomberg analysts, Hindalco was likely to report a consolidated net profit of Rs 3,372.10 crore for the December quarter, with revenue pegged at Rs 55,918.90 crore.

Its India business posted upbeat numbers during the quarter, with net profit rising 134 per cent at Rs 2,885 crore. On February 13, Hindalco's shares on BSE closed nearly 1% higher at Rs 604.4 apiece. Revenue rose 19 per cent to Rs 24,618 crore.

Meanwhile, profit declined 4.4 per cent sequentially from Rs 3,909 crore reported in  the previous quarter.

Segment results 

Quarterly revenue from the copper  business came in at Rs 13,732 crore, up 15 percent, on account of higher copper prices despite a drop in shipments. Meanwhile, consolidated revenue from operations of aluminum upstream and downstream business both increased 25 percent YoY each at Rs 9,993 crore and Rs 3,195 crore respectively, the company said in an exchange filing on November 11.

Its US-based subsidiary, Novelis Inc., contributed approximately 58.5% of Hindalco's total revenue. However, excluding Novelis, other segments delivered double-digit EBITDA growth during the quarter, aided by strong demand, higher prices and lower input costs.

Revenue at Novelis business, which supplies premium aluminium sheet and foil products to the beverage can, automotive, aerospace and specialty markets, rose 4 per cent to $4.10 billon. It's, EBITDA declined 19 per cent to $367 million.

"Novelis continues to focus on operational and cost efficiency initiatives in the face of current pressures on scrap pricing," Pai said.

Meanwhile, the company noted a  4 per cent rise in the market demand for refined copper and 11 per cent growth in domestic aluminium demand  during the October-December quarter.

"Hindalco delivered robust consolidated results in the third quarter despite global uncertainties, driven by an excellent performance of its India business," added Pai. He further said  that the company secured "critical resources" for India upstream business, "enhancing global cost leadership".

Meanwhile, the company's net debt rose 20 per cent at Rs 41,818 crore, consolidated net-debt to EBITDA ratio stood at 1.33, down from 1.43 reported an year earlier. Last quarter, Hindalco announced plans to invest between $4-5 billion over the next three years, in a bid to grow the upstream side of business.

"Key growth initiatives, such as the alumina refinery, aluminium smelter expansion, copper smelter expansion and the FRP project, remains on track", Pai said.