Informist, Friday, May 24, 2024
--Hindalco: Jan-Mar consol net profit 31.74 bln rupees
--Analysts saw Hindalco Jan-Mar consol net profit 28.91 bln rupees
--Hindalco: Jan-Mar consol revenue 559.94 bln rupees
--Hindalco: To pay 3.50 rupees a share dividend
--Hindalco: Jan-Mar consol net profit 31.74 bln rupees vs 24.11 bln rupees
--Hindalco: Jan-Mar consol revenue 559.94 bln rupees vs 558.57 bln rupees
--Hindalco: FY24 consol net profit 101.55 bln rupees vs 100.97 bln rupees
--Hindalco: FY24 consol revenue 2.160 trln rupees vs 2.232 trln rupees
--Hindalco: Jan-Mar consol EBITDA 72.01 bln rupees, up 24% on year
--Hindalco: Jan-Mar upstream aluminium EBITDA 27.09 bln rupees
--Hindalco: Jan-Mar upstream aluminium EBITDA up 24% on year
--Hindalco: Jan-Mar copper EBITDA 7.76 bln rupees, up 30% on year
--Hindalco: Jan-Mar Novelis adjusted EBITDA/tn $540, up 25% on year
--Hindalco: Consol net debt-to-EBITDA ratio 1.21x as of Mar 31
--Hindalco: Jan-Mar EBITDA driven by lower input costs, higher volume
--Hindalco: Jan-Mar upstream aluminium shipment 337,000 tn, up 4% on year
--Hindalco: To buy fabrication facility of Home Build Tech
--Hindalco: Jan-Mar downstream aluminium shipment 105,000 tn, up 17%
--Hindalco: Jan-Mar copper shipment 135,000 tn, up 16% on year
--Hindalco: To buy Home Build's fabrication facility for 340 mln rupees
--Hindalco: Jan-Mar upstream aluminium EBITDA/tn $967, up 17% on year
--Hindalco: See Apr-Jun domestic aluminium output cost 1% lower QoQ
--CONTEXT: Hindalco mgmt's comments in post-earnings investor call
--Hindalco: To spend 60 bln rupees in capex for India business FY25
--Hindalco: India business net cash 34.39 bln rupees as of Mar 31
--Hindalco: Novelis net debt 359.37 bln rupees as of Mar 31
By Rajesh Gajra
MUMBAI – Benign input costs and reasonable increase in sales volume improved the profitability of Hindalco Industries Ltd in the quarter ended March, with the topline and bottomline beating analyst estimates. However, there are concerns over weak sales realisations.
Overseas subsidiary Novelis, which contributes around 62% to Hindalco's consolidated revenue and around 54% to the net profit, continued to report weak numbers. In fact, the 7?ll in Novelis' revenue to $4.08 bln was the main reason why the aluminium and copper manufacturer's revenue was flat at 559.94 bln rupees.
Hindalco's India business, largely comprising the aluminium upstream and downstream segments and the copper segment, reported a 12% increase in revenue to 204.44 bln rupees.
Lower input costs and higher volumes helped improve the company's profitability, with the earnings before interest, tax, depreciation, and amortisation rising 24% on year to 72.01 bln rupees. All segments scored high on profitability. Novelis' EBITDA jumped up 28% on year to $514 mln with the EBITDA per tonne rising 25% to $540. The company's upstream aluminium EBITDA rose 24% on year to 27.09 bln rupees with the EBITDA per tonne rising 17% to $967. The copper segment's EBITDA surged 30% to 7.76 bln rupees.
In a post earnings conference call with analysts today, Hindalco's management said that all input costs were lower in the March quarter compared to the year ago period. The management said that in India, the petroleum coke costs, for instance, were not only down 8% sequentially but were lower by as much as 28% on a year-on-year basis.
As per the company's financial statement, the consolidated cost of materials consumed declined 2.9% to 327.58 bln rupees. The power and fuel expenses declined 5.9% on year to 36.24 bln rupees while other expenses increased 2.5% to 73.97 bln rupees.
The management said that EBITDA of the India business was clearly aided by the lower cost of production in the March quarter. It further expects that the Apr-Jun cost of production in domestic aluminium business to be 1% lower than the March quarter.
In Jan-Mar, Hindalco's consolidated net profit rose 31.6% on year to 31.74 bln rupees, beating analyst estimates of 28.91 bln rupees. The company's consolidated revenue was nearly flat at 559.94 bln rupees.
Hindalco's topline performance in India business in Jan-Mar was mainly driven by volume growth and better realisations in the copper segment. The copper shipment volume rose 16% on year to 135,000 tn and the revenue rose still higher by 20% to 134.24 bln rupees. The upstream aluminium shipment volume rose 4% to 337,000 tn with the revenue increasing 5% to 84.69 bln rupees, while the aluminium downstream segment saw shipment volume rise 17% to 105,000 tn but revenue rising only 7% to 29.20 bln rupees.
DEBT AND LEVERAGE
Hindalco's consolidated gross debt increased to 545.01 bln rupees as of Mar 31 from 534.02 bln rupees as of Dec 31. But since the cash balance increased to 229.65 bln rupees from 185.66 bln rupees, the net debt declined to 315.36 bln rupees as of Mar 31 from 348.35 bln rupees.
The management told analysts at the post earnings call that Novelis' net debt was 359.37 bln rupees as of Mar 31 and that the India business had a net cash position of 34.39 bln rupees. The company said the positive net cash position in the India business will get utilised as it aims to incur a capital expenditure of 60 bln rupees in 2024-25.
Hindalco's consolidated net profit for the year 2023-24 (Apr-Mar) rose 0.6% to 101.55 bln rupees, even as revenue declined 3.2% to 2.16 trln rupees. The company's board has approved a dividend of 3.50 rupees per share.
Today the company announced the acquisition of the fabrication unit of Home Build Tech for 340 mln rupees in the next 4-6 months. The acquisition, which will be through a special purpose vehicle, is aimed to aid the company in manufacturing fabricated windows and doors and support the retail business of 'Eternia", a downstream brand.
On the National Stock Exchange, shares of Hindalco closed higher by 0.52% at 673.25 rupees. End
US$1 = 83.10 rupees
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