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| Hindalco's annual net down by 80% |
| BS Reporter / Mumbai Jul 01, 2009, 00:40 IST |
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 Hindalco Industries, India’s largest aluminium producer, has reported a Rs 485-crore net profit for the fiscal year ending March 31, 2009 — a decline of about 80 per cent from Rs 2,193 crore in the previous year — as its subsidiaries, such as Canadian Novelis, pulled down its profit due to higher raw material cost and derivative losses.
On a stand-alone basis, Hindalco reported a net profit of Rs 2,230 crore against Rs 2,860 crore in the previous year.
The consolidated revenue of the company grew 9 per cent in the period to Rs 65,625 crore. The company had a $519-million (around Rs 2,725-crore) loss on derivatives as the base metal’s price fell sharply. The raw material costs for the company increased by 10 per cent to Rs 44,515 crore in the period, further eating into profit margins.
“We expect global demand to outstrip capacity in 2013,” said D Bhattacharya, managing director of the company, who remained cautious on the short-term outlook. “We will be well positioned with our 1.7-million capacity by then to benefit from it,” he said.
Globally, the aluminium producing capacity is expected to be around 50-55 million by then. Last year, base metal prices fell about 40-50 per cent as the global economic slowdown hit demand for raw materials, such as the aluminium used in automotive and construction industry. It is this year’s worst performer among the key metals traded on the London Metal Exchange (LME). The inventories of the metal tracked by the LME reached a record 4.28 million tons on June 9.
The company has an ongoing capital expenditure plan of about Rs 30,000 crore till 2013.
To raise $500 mn
On Tuesday, the company also announced plans to raise $500 million (nearly Rs 2,400 crore) by selling equity to institutional investors.
The company has a Rs 13,000-crore debt on a stand-alone basis, out of which about Rs 4,800 crore is due in four years, with Rs 5,000 crore being paid in installments till 2013-14. The balance of the debt is working capital.
The stock of the company closed 1.5 per cent down to Rs 86.4 a share on Tuesday.
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