Mumbai: India’s biggest non-ferrous metals company, Hindalco Industries Ltd, reported anunexpected jump in profit in the second quarter ended30 September as the company’s aluminium and copper production rose and tax payments fell. The Rs643 crore profit for the quarter—up from Rs597 crore a year ago—beat the median forecast of a 9.5% decline by seven analysts surveyed by Bloomberg.
Total sales rose 7% to Rs4,960 crore.
Hindalco increased output to counter a dip in domestic aluminium prices and a slump in copper-refining fees. It produced 8% more aluminium to overcome two price cuts in the quarter. Copper output rose 11% even as copper-treatment charges slumped 15%.
Analysts said a stronger rupee, which makes imports cheaper, may prevent the company from raising rates. “It will be difficult to deliver this kind of earnings as there’s not much scope to increase output” until Hindalco’s new aluminium plants begin operations, said Bharath S., an analyst at Sundaram BNP Paribas Mutual Fund in Chennai. “A stronger rupee will continue to be a dampener.”
Tax payments fell 24% to Rs182 crore.
The firm’s shares closed at Rs196.3, up 1.6%, on the Bombay Stock Exchange. The stock has gained 13% this year, lagging the 44% advance in the Sensex. Bloomberg