Speaking at the Hindalco AGM, Kumar Mangalam Birla, Chairman of the Aditya Birla Group said that India is well positioned to weather global volatility. Good monsoon will drive rural demand, he added. “I am fully tuned into PM Narendra Modi’s Make in India concept,” he said. When asked about Hindalco, he said “Aluminium industry has faced significant challenges in FY16 and cost efficiencies of Hindalco are at an all-time high.”
Earlier this year, Birla said India already has a track record in manufacturing, and is now getting into the next phase. “India is now in a sweet spot… it’s the fastest growing economy in the world,” he said. For India to become a manufacturing hub, it will require huge investments, especially from abroad. In that sense, the grand spectacle of the MIIW which attracted 8,000 business delegates from 22 countries across 11 industrial sectors, went a long way in creating the right noises.
Hit by oversupply and depressed prices of metals, the outlook for leading aluminium and copper producer Hindalco is “challenging” in the short term, he said. Besides, high imports will continue to impact sales of the flagship company of the $41 billion Aditya Birla Group, he added. “Notwithstanding the strong operational performance, the short term outlook is challenging given the structural oversupply and depressed pricing scenario. The sharp increase in imports will continue to impact sales.”
However, on the positive side, he said demand in India is expected to be strong, as the firm sees an improved outlook on industrial and infrastructure growth. “The government’s thrust on the power sector works well for the aluminium and copper industry. We are also sharpening our thrust on downstream value added products in India, as these yield better realisation,” Birla noted.
On the aluminium industry scenario in 2015-16, he said the industry witnessed significant challenges as the average realisations crashed.