Tighter aluminium supplies to drive Hindalco, Vedanta's earnings

Improving realisations to benefit both; Nalco also gains from higher alumina prices

Rusal accounts for close to six per cent of global aluminium supplies and 13-14 per cent of overall supplies if China is excluded. Analysts at Kotak Institutional Equities say that sanctions against the company can have an adverse impact on the global aluminium supply chain, and hence they expect strong improvement in outlook in next two years.

Aluminium prices on the London Metal Exchange (LME) are up sharply by 14.5 per cent in less than a week, on supply disruption concerns. The per-tonne price had plummeted to $1,966 last Friday; it surprised the market by rebounding to $2,251 on Wednesday.

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