The world?s largest aluminium can maker Hindalco Industries, owned by Aditya Birla Group, reported a 16% increase in its net profit to R 503 crore for fiscal second quarter ended September 30, but cautioned that next two quarters will be difficult owing to an uncertain global economy, falling metal prices and cost hikes.
?Overall, the second half of the financial year is expected to be challenging in terms of cost pressure, domestic demand and margins,? Hindalco vice-chairman and MD Debu Bhattacharya said after announcing the results adding that the reporting quarter?s performance was impacted by rising cost and restricted supply of coal and bauxite.
Sales grew 7% to R6,272 crore from R5,860 crore in the same period previous year driven by high volumes and better margins. Operating profits were up 8% to R845 crore on higher volumes and improved realisation.
Analysts said the results were a tad below expectations, but said the company expansions are on track despite a slowing economy.
?Forex losses might have missed expectations,? said P Phani Shekhar, an analyst with Angel Broking. ?There might have been some volume disappointment from Novelis, Hindalco?s Canadian subsidiary. There is no material impact on Hindalco shares as it has been performing well,? he added.
Revenues from Aluminium, the primary product, grew by 16% to R2,213 crore from R1,911 crore in the same quarter previous year, as they sold more at higher prices on the LME. Last year, Hindalco cut down production as one of smelters cracked. Copper revenues grew slightly by 2.8% to R4,062 crore as against R3,951 crore as it sold more.