Novelis Inc, a wholly owned subsidiary of Hindalco Industries Ltd on Tuesday (February 20) announced the confidential submission with the Securities and Exchange Commission (SEC) for a proposed initial public offering (IPO).
The common shares are expected to be offered by Novelis’ sole shareholder (a subsidiary of Hindalco Industries), the company said in a release. Novelis will not receive any proceeds from the sale of common shares by Hindalco.
Aluminum solutions provider Novelis expects to complete the public offering after the SEC completes its review process, subject to market and other conditions.
Earlier in February, Hindalco Industries put its weight behind the Bay Minette project being developed by Novelis amid growing concern among the shareholders due to the cost overrun.
The project’s total capital cost has gone up 65%, according to Novelis. Hindalco in its financial report for Q3 of FY2024 revised the total capital expenditure of the project to $4.1 billion.
Hindalco in its financial report for Q3FY2024 revised the total capital expenditure of the project to $4.1 billion. The expected commissioning of the project has also been delayed by one year to the end of the calendar year 2026 or the second half of 2027.
In Q3 of FY2024, the net profit of the company fell by 23% quarter over quarter (QoQ) to $121 million from $174 million, in the quarter that ended September 2023.
The company reported adjusted EBITDA of $454 million in the third quarter of FY24. Novelis reported that adjusted EBITDA per tonne shipped was $499 and expects margins of around $525/tonne.
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