Hindalco Q2: Expect EBITDA/t to hold steady in Q3; LME aluminium at around $2,700/t, says management

Hindalco expects EBITDA per tonne to hold steady in Q3, Satish Pai, managing director, told CNBC-TV18.

Aditya Birla group company Hindalco Industries reported a consolidated net profit of Rs 3,417 crore for the quarter ended September. The Mumbai-based metal company had reported a net profit of Rs 387 crore for the corresponding period a year ago.

Its consolidated revenue came in at Rs 47,665 crore for the three months to September 30, an increase of 52.6 percent on a year-on-year basis.

“We believe that the London Metal Exchange (LME) will stay firm going forward because the supply and demand of aluminium are tight; the world is in a deficit of about 0.9 million tonne. So, the LME prices should hold. Cost inflation, Q2 to Q3 will be there. So a certain amount of cost inflation will come in, but EBITDA per tonne and margins for the business will be healthy going forward,” Pai said.

On aluminium price, he said, “LME had hit around USD 3,000 per tonne and currently it’s trading at about USD 2,650. So, I believe that the current range will be around USD 2,700 and we will have to see how it performs, but the EBITDA per tonne is going to remain above USD 1,000 per tonne; I cannot give a more exact number than that.”

However, said Pai, aluminium EBITDA should be at around USD 1,300 per tonne range.

Also, Hindalco is looking at paying a Rs 6,000 crore bond which is due, rather than refinancing it.