By Manvi Pant and Neha Arora
BENGALURU (Reuters) -India’s Hindalco Industries, one of the country’s largest aluminium and copper producers, reported a smaller-than-expected quarterly profit on Friday, hurt by lacklustre aluminium prices and demand.
The Aditya Birla Group-owned company, which operates in 10 countries, said its consolidated net profit fell to 21.96 billion rupees ($263.33 million) in the three-month period ended Sept. 30, from 22.05 billion rupees a year earlier.
Analysts, on average, expected a profit of 24.86 billion rupees.
Average aluminium and zinc prices slumped in the second quarter, with the London Metal Exchange’s aluminium rates dropping 5.1% and alumina sliding 4.1% quarter-on-quarter, analysts said.
Factory activity in September expanded in India – the world’s second-biggest aluminium producer – at the slowest pace in five months, a private survey showed.
However, the company expects aluminium demand to pick up at a strong pace in the ongoing quarter that ends in December, Managing Director Satish Pai said in a post-results briefing.
Meanwhile, the company is also concerned about rising imports from China, Pai said, adding that it was attempting to get an anti-dumping duty imposed on aluminium foil.
Novelis, Hindalco’s U.S. unit and home to the company’s biggest operations, recorded an 11.4% plunge in revenue, pulling down total sales nearly 4% to 541.69 billion rupees.
Hindalco said in a statement that revenue from its copper business, the company’s second-largest segment, rose around 30% to 124.41 billion rupees due to higher metal shipments.
Shares of Hindalco, which houses global brands such as Eternia Windows, Maxloader and Everlast Roofings, traded flat after the results. The stock gained 17% during the quarter, outpacing a 2.3% rise in the benchmark Nifty 50 Index.
Separately, the Indian government has approached Hindalco for gallium extraction, Pai said, adding the company has shown interest in some of the critical minerals that officials had earlier announced.
($1 = 83.3929 Indian rupees)
(Reporting by Manvi Pant in Bengaluru and Neha Arora in New Delhi; Editing by Sherry Jacob-Phillips and Sonia Cheema)
