Hindalco has reported highest ever production of both aluminium and copper in the second quarter ended September 30, 2009. However, the sharp fall in sales realisation in aluminium business and lower by-product credits in copper business have adversely impacted the performance. Net sales and operating revenue were lower at Rs. 4,917 crore for the second quarter against Rs. 5,683.20 crore in the year-ago period.
The steep reduction in aluminium and copper on LME led to a fall in the overall sales revenue and therefore profitability. The benefits of the brown-field expansion cushioned the fall due to lower commodity prices. The decline was also mitigated by the rupee depreciation against the dollar and higher sales volume.
Consequently the profit before depreciation, interest and tax was also lower at Rs. 666.40 crore against Rs. 1,170.20 crore and the net profit after taxation Rs. 344.10 crore against Rs. 720.20 crore. The 35 per cent fall in LME over the year-ago period levels dented the top line and the bottom-line. In the copper business, revenues declined by 8 per cent to Rs. 3,269 crore from Rs. 3,565 crore mainly on account of lower copper LME.
Resource mobilisation
The company has decided to raise long term funds not exceeding Rs. 2,900 crore through qualified institutional placement. A captive power plant of 20 MW is proposed at the existing plant at Mouda, near Nagpur to reduce the cost of energy used by the company’s plants in Maharashtra. Pre-project activities have started. A wholly-owned subsidiary by the name Mouda Energy Limited has been incorporated.
Brownfield expansion
Work on the smelter expansion at Hirakud (Orissa) from 155 ktpa to 213 ktpa is now underway. Part of this will be completed by July 2010 and the rest will be commissioned in 2012. The alumina production from Belgaum will be ramped up to 316 ktpa from 138 ktpa.
