Hindalco posts highest ever quarterly profit in Q1 at Rs 4,119 cr, up 48%

Hindalco Industries Ltd.’s quarterly profit jumped by almost half from a year earlier, underpinned by strong US sales and higher revenue that cushioned the impact of pricier raw materials.

Hindalco on Wednesday reported a 47.7% rise in consolidated profit after tax (PAT) at Rs 4,119 crore for the quarter ended June 30, on the back of strong operational efficiencies. That beat analysts’ estimates for a profit of Rs 2,850 crore.

The company had posted a consolidated PAT of Rs 2,787 crore in the year-ago period, Hindalco Industries, the metals flagship of Aditya Birla Group, said in a regulatory filing.

Sales climbed 40% from a year earlier to Rs 58,020 crore.

The performance of Hindalco, controlled by billionaire Kumar Mangalam Birla, was aided by aluminum prices that, while falling over the period, were higher than last year. Global supply chain problems persist, including lower output in Europe, where mills are grappling with soaring energy costs.

"Our performance was backed by strong operational efficiencies and pre-emptive sourcing of critical raw material, thus ensuring stable operations and higher margins," company's Managing Director Satish Pai said.

Pai said that the company delivered a stronger first quarter in spite of rising input costs and inflationary pressures.

The company's revenue from the copper business in the first quarter increased by 48% to Rs 10,529 crore mainly on account of higher global prices of copper and higher volumes.

Shares of Hindalco Industries were trading at Rs 443.35 apiece on BSE, up 5.20% over the previous close. There are 23 buy recommendations from analysts on the company, and only one sell, according to data compiled by Bloomberg.

Hindalco’s US unit Novelis Inc. reported a 32% year-on-year increase in sales and $307 million in net income from continuing operations, it reported last week. The company saw record shipments in North America on strong demand from can manufactures and the automotive sector, although the favorable pricing environment was partly offset by inflationary pressures.

Aluminum consumption in India rose 11% in April-June from a year earlier, led by improved demand from sectors like packaging, automotive, building & construction, consumer durables, and electrical, Hindalco said. Copper demand grew by about 47%, it said.

The company’s net debt fell 19% from a year earlier to Rs 42,193 crore at the end of June, it said in the earnings presentation.