Hindalco Industries, an Aditya Birla Group company, has earmarked capex of Rs 5,000 crore each for this fiscal and the next, which would be used mainly for its ongoing expansion plans. This is a 67% increase from `3,000 crore the company had spent in FY23. The firm would funnel its entire capex requirements through internal accruals and will not raise debt, Hindalco Industries MD Satish Pai said in a post-earnings call.
For the fourth quarter ended March 31, the company posted a net profit of `2,411 crore, a 37% fall from `3,851 crore recorded during the year-ago period. However, it rose 77% from Rs 1,362 crore posted in the December quarter.
The capex plans for this year include setting up 170 KT flat rolled products capacity in Aditya Aluminium and Hirakud in Odisha, and setting up of Chakla coal mine.
Further, it would also be used for expansion plans of Mahan Aluminium in Madhya Pradesh, and capacity expansion to 350 KT at Utkal Alumina through debottlenecking.
Hindalco Industries is also putting off its planned $350-million capex in China due to the trade tussle between the US and China that is hampering the business environment.
However, it will continue with its planned investment of $1.8 billion in the US subsidiary, which would be used for expansion plans across the US, Brazil and South Korea.
The aluminium producer is also planning to ramp up low-carbon production to at least 30% in the next three-four years, expecting a rise in global demand.
The company will certify about 8% of its annual aluminium production of 1.3 million tonne as low-carbon in the current fiscal, and it will scale this up further as renewable energy supply grows, he said.
The company had shipped about 200 tonne of low-carbon aluminium to western economies, Pai added.
The demand in India for aluminium and copper was “strong” he said, adding that the company’s 34,000-tonne per annum extrusion plant at Silvassa will go on stream in the next few days. This is to cater to the domestic demand.
“In the fourth quarter of last financial year, the LME prices were high due to the war (Ukraine-Russia) and demand was also very high,” Pai said.
During the March quarter, the company’s consolidated revenue stood at `55,857 crore, a rise from `55,764 crore recorded during the year-ago quarter, on account of better realisations and volumes in India operations.
A consensus estimate of Bloomberg analysts was expecting the company to post a consolidated net profit of `2,047 crore, on revenues of `47,506 crore and Ebitda of `4,987 crore.