Hindalco Q3 Results: Profit Misses Estimates On Lower Margin, Cost Pressures

Hindalco Industries Ltd.’s net profit for the third quarter dropped on lower margin and inflationary pressures, despite higher sales.

The consolidated net profit for the Aditya Birla Group’s metal flagship dropped 63% year-on-year to Rs 1,362 crore, primarily due to elevated input costs, unfavourable macros, and inflationary impact, the company said, in its exchange filing.

• Revenue from operations rose 6% year-on-year to Rs 53,151 crore, as against the Rs 52,492.5 crore forecast. Revenue was driven by higher volume and steady operational performance across India operations.

• The copper business and aluminium downstream business reported 40% and 24% year-on-year growth in Ebitda, respectively, on account of better pricing and recovery in domestic demand.

• Novelis, the U.S.-based operation was, however, impacted by lower average aluminium prices and lower shipments. The company also witnessed unfavourable foreign exchange rates.

• Novelis’ revenue for Q3 FY23 fell 3% year-on-year to $4.2 billion.

“We are seeing core industries worldwide being buffeted by macro-economic and inflationary cost pressures, yet we delivered a strong operational performance with higher volume across India's business segments,” said Satish Pai, managing director at Hindalco Industries.

Pai said that though the India aluminium upstream business' Ebitda came under pressure from the surge in input costs and lower realisations, this was partially offset by higher volumes.

“Despite the hits of this quarter, due to external factors, we believe the long-term story remains positive backed by our strong balance sheet and resilient business model.”