Mumbai: India’s second biggest aluminium producer, National Aluminium Co. Ltd, posted a drop in third-quarter profit and forecast earnings will slide further should prices fail to improve.
Third-quarter net income declined to Rs219 crore in the three months to December from Rs329 crore a year earlier, chairman C.R. Pradhan said over the telephone. Sales fell 14% to Rs1,020 crore. Fourth-quarter profit will fall if global aluminium prices, down 27% in the period, continue at the same level, he said.
The worst financial crisis since the Great Depression has reduced consumer demand, prompting companies to lower output and prices. Alcoa Inc., the world’s largest aluminium maker, announced on 6 January its third production cut in as many months because of falling prices and declining demand from builders and makers of cars and appliances.
Demand shows no signs of improving in the near term, Pradhan said. The Union government may impose duties on imports of aluminium to shield local producers as the global recession drives down prices, commerce secretary G.K. Pillai said on Wednesday. Shares of National Aluminium rose 2.8% to Rs197.05 at close of trade in Mumbai, tracking the gain in the benchmark Sensex index. The shares have fallen 51% in the past year, compared with a 49% drop in the Sensex. Prices of aluminium have fallen 13% this year as stockpiles monitored by the London Metal Exchange surged to the highest since 1978.