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Hindalco Q3 profit rises 77% to Rs 1,877 crore on strong operational efficiencies, improved macros

Hindalco Q3 results: The consolidated revenue from operations surged by 20 per cent to Rs 34,958 crore in Q3 FY21 as compared to Rs 29,197 crore in the same period last year

Chitranjan Kumar | February 10, 2021 | Updated 14:48 IST
Hindalco Q3 profit rises 77% to Rs 1,877 crore on strong operational efficiencies, improved macros
Hindalco's India business PAT rises 90% YoY to Rs 495 crore

Hindalco Industries, the metals flagship company of Aditya Birla Group, on Wednesday reported consolidated profit after tax (PAT) at Rs 1,877 crore for the third quarter ended December 31, 2020, up 77 per cent year-on-year (YoY) and 385 per cent sequentially. The aluminium and copper manufacturing company had posted consolidated profit of Rs 1,062 crore in Q3 FY20 and Rs 387 crore in Q2 FY20.

The results were driven by a strong performance by Novelis and India Aluminium business, supported by higher volumes and better product mix, lower input costs, stability in operations and cost saving actions.

The consolidated revenue from operations surged by 20 per cent to Rs 34,958 crore in Q3 FY21 as compared to Rs 29,197 crore in the same period last year, Hindalco Industries said in a regulatory filing.

Consolidated business EBITDA rose by 40 per cent YOY to Rs 5,242 crore compared to Rs 3,733 crore in the year ago period, driven by the best-ever quarterly performance by Novelis and a sharp recovery in all relevant markets in India Aluminium business.

India business PAT stood at Rs 495 crore, up 90 per cent YoY and 51 per cent sequentially. Aluminium India business EBITDA was at Rs 1,323 crore, up 27% YoY, while EBITDA margin improved to 25 per cent, up 593 bps YoY.

The consolidated net debt to EBITDA ratio improved significantly to 3.09x on December 31, 2020, from a peak of 3.83x on June 30, 2020.

Novelis, a subsidiary of Hindalco, recorded its best-ever quarterly adjusted EBITDA of $501 million (vs $343 million), up 46 per cent YoY, on the back of higher volumes and improved margins. Revenue was $3.2 billion (vs $2.7 billion), up 19 per cent YoY, due to higher shipments, global aluminium prices and market premiums.

Commenting on the Q3 earnings, Satish Pai, Managing Director, Hindalco Industries Ltd., said, "Our Q3 results flag a return to business at pre-COVID levels with resurgent demand globally. Novelis achieved record shipments, driven by strong demand across product end markets. The India Business delivered an excellent performance with Aluminium value-added products continuing to record higher volumes. Along with market performance, we have strengthened our balance sheet which shows in a significant improvement in the consolidated net debt to EBITDA ratio. The inclusion of the Aleris business has positively impacted the overall top line and EBITDA, with realisation of synergies at $54 million on a run-rate basis in Q3.

"Our performance is a reflection of our sustainability-led approach to business. Hindalco has been recognised as the world's most sustainable aluminium company in the 2020 DJSI CSA ranking," he added.

In a separate development, Hindalco said that its nomination and remuneration committee of the board of directors has approved the grant of 4,95,108 Stock Options and 20,487 restricted stock units (RSUs) to eligible employees of the company.

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