Hindalco net declines 4% to Rs 434 cr

Aditya Birla’s flagship company, Hindalco Industries, reported a four per cent drop in net profit for the third quarter ended December 31. Its standalone profit stood at Rs 434 crore against Rs 451 crore in the corresponding quarter last year.

However, there has been an exceptional item of Rs 144 crore in the profit. Excluding the exceptional items, profit after tax declined 36 per cent to Rs 289 crore.

Debu Bhattacharya, managing director, Hindalco Industries, said, “The exceptional item has been on account of treasury and is a one-off gain. Input price pressure continued in the quarter but copper did significantly better than aluminium.”

The company, however, reported an increase in its revenues. The company said that its revenues jumped from Rs 6647 crore in the same quarter last year to Rs 6872 crore in the third quarter of this fiscal. Pure earnings, or EBITDA, saw a sharp drop of 18.6 per cent to Rs 582 crore versus Rs 713 crore, last year.

Finance costs went up to Rs 169 crore as against Rs 79 crore. The company said, “Finance costs rose on account of greater average borrowings during the quarter.” It said that it drew around Rs 530 crore from Export Development Canada for its Mahan Aluminium Project. Bhavesh Chauhan, senior research analyst, Angel Broking said, “ Hindalco’s top-line and bottom-line were below our expectations. Other income grew by 93.2 per cent yoy to Rs 174 crore and there were exceptional items of Rs 144 crore during the quarter.”

Talking about the outlook for aluminium and copper, Bhattacharya said, “Aluminium production is back to normal after brief disruptions in the previous quarters but external factors continue to be negative.” On copper, he said that the outlook is steady but headwinds continue.

The net debt in the company’s books as on December 31, 2012 stood at Rs 12,000 crore and net debt to equity ratio was 0.35:1.

The share price of Hindalco dropped 3.18 per cent to Rs 109.75 per share on the Bombay Stock Exchange on Friday.