Hindalco posts 32% jump in Q4 profit on strong margin, volumes

New Delhi: Hindalco Industries, the flagship company of the Aditya Birla group, on Friday reported a 32% year-on-year jump in its consolidated net profit to ₹3,174 crore for the quarter ended March driven by strong margins and volumes across aluminium and copper businesses. 

The base metals major's revenue from operations for the quarter was flat year-on-year at ₹55,994 crore.

Hindalco's earnings before interest, taxes, depreciation, and amortization or Ebitda stood at ₹7,201 crore for Q4FY24, up 24%, driven by lower input costs and higher volumes.

The demand for copper and aluminium going ahead remains very strong in India, said Satish Pai, managing director, Hindalco Industries.

"I think that we can get to the monsoon where we don't have supply disruptions, so, our cost of production is under control and if the commodity prices remain favorable, we should have another good year,” Pai said in a statement.

Consolidated net debt to Ebitda stood at 1.21 times as of 31 March 2024 against 1.39 times in the corresponding period a year ago. 

“We continue to maintain a strong balance sheet and solid liquidity even after repaying ₹5,195 crore of debt in Hindalco India business during the year. This positions us well to stay on our growth track and drive our future organic growth plans with prudent capital allocation,” he said.

Also Read: What explains the market-analyst divide on Hindalco?

The company has allocated a capital expenditure of ₹6,000 crore for FY5. 

“This year we don’t have plans to make repayments… we would rather spend the cash on the growth capex, we have planned - the alumina refinery, copper recycling, and aluminium batter foil," Pai said.

"We are also completing the expansion of the FRP (flat-rolled project) in Lapanga in Odisha, which is to be commissioned in December,” he added.

Copper revenue for the quarter rose 20% YoY to ₹13,424 crore. Robust operations and strong sale volumes in the copper business helped the company register a record Ebitda of ₹776 crore, up 30%. 

The aluminium upstream business Ebitda stood at ₹2,709 crore with margins of 32%, supported by higher volumes and cost optimisation.

“The copper business has grown to become the 2nd largest in the world for copper rods (excluding China). It achieved its best-ever performance with sales crossing 500,000 tonnes for the first time, and an all-time high Ebitda for the quarter and the year,” added Pai.

During the fourth quarter, the company’s cost of raw materials stood at ₹32,758 crore, down marginally.

Also read: Hindalco’s shine relies on aluminium prices 

The company's IPO-bound overseas subsidiary, Novelis reported revenue of ₹33,859 crore, down 6.4% from ₹36,176 crore a year ago due to lower average aluminium prices. Ebitda per tonne for the subsidiary stood at $540, up by 25%.

Hindalso said the Novelis’ Bay Minette, US project is on track and is expected to be completed by the second half of the calendar year 2026.

Pai believes Hindalco will see lower cost of production sequentially in the first quarter of FY25. 

The company's consolidated revenue from operations during the fiscal year 2024 fell 3.24% year-on-year to ₹215,962 crore, while profit stood at ₹10,155 crore, up marginally.

Also read: Hindalco’s expansion plans are fine but demand is still muted