Hindalco expansion plans could bridge India's copper supply gap: MD

Hindalco Managing Director Satish Pai says new smelting, recycling and exploration projects could help India eliminate refined copper import dependence within two years

India could eliminate its dependence on imported refined copper within the next two years as new smelting and recycling capacities come onstream, according to Satish Pai, managing director of Hindalco Industries, who outlined an aggressive expansion, integration and resource-security strategy for the metal amid tightening global supply conditions.

 

“Within the next two years, India will not be dependent on imported copper going forward,” Pai said on Monday during a media interaction following the company’s 2025-26 (FY26) earnings announcement.

 

The statement comes at a time when Prime Minister (PM) Narendra Modi earlier this month raised concerns over rising copper imports. Business Standard reported on 18 May that India’s copper import bill rose from ₹22,856 crore in FY17 to ₹1.03 trillion in FY26 until February, marking an increase of more than 350 per cent in less than a decade.

 

Pai said the commissioning of Adani Group’s Gujarat copper plant, Hindalco’s own expansion projects and a new copper recycling facility would help bridge the domestic supply gap.

 

Hindalco is setting up a 50-kilotonne copper recycling plant and expanding its smelting operations through its Copper-5 project, a brownfield expansion initiative in Gujarat for the production of copper cathodes, for which the company recently completed the public hearing process.

 

Pai also disclosed that Hindalco’s domestic copper exploration efforts in the Minzari copper block in Maharashtra have shown “encouraging signs”, marking one of the clearest indications yet of the company’s intent to secure long-term copper ore supplies within India. The company acquired the block through auction in 2023. Hindalco is also participating in additional exploration licence auctions for domestic copper ore blocks.

 

While India may become self-sufficient in refined copper, Pai acknowledged that the country would continue to rely on imported copper concentrate for the foreseeable future. However, Hindalco aims to increase domestic ore sourcing to 20-25 per cent of its requirements within five years, up from around 10 per cent currently sourced through mines operated by Hindustan Copper.

 

The comments come even as global copper smelting economics remain under severe pressure because of sharply lower treatment and refining charges (TC/RCs), which have squeezed margins for custom smelters worldwide.

 

Despite this, Hindalco expects its copper business to remain profitable because of its diversified earnings profile extending beyond refined copper sales.

 

Pai said the company can continue generating “reasonable returns even when TC/RCs are negative”, underlining Hindalco’s strategy of reducing dependence on traditional smelting spreads.

 

He added that profitability is increasingly being supported by downstream copper products such as rods, wires and conductors, alongside sulphuric acid and precious metal by-products including gold and silver recovered during smelting.

 

Pai also said Hindalco has secured long-term copper concentrate contracts for the next five years and remains confident of sustaining operations despite weak global TC/RC conditions.

 

Hindalco’s copper business reported record quarterly earnings before interest, taxes, depreciation and amortisation (Ebitda) of ₹907 crore, up 48 per cent year-on-year in the January-March quarter. However, full-year Ebitda declined 7 per cent to ₹2,809 crore.

 

Pai said the company is optimistic about delivering stronger financial performance from the copper business in the current financial year. “We are confident that we will generate ₹600-700 crore per quarter of copper Ebitda in FY27,” he said.