Metals major Hindalco Industries on Tuesday reported an 11.61 per cent growth in standalone net profit to Rs 474 crore in the June quarter and said it is re-evaluating two investment plans of about Rs 16,000 crore due to delays in approvals.
The Aditya Birla Group's flagship arm said net profit for the first quarter was driven by a rise in other income and dividends from subsidiaries, which offset a 3.25 per cent dip in revenue. Net profit was Rs 425 crore a year earlier.
"We are re-evaluating our investment strategy with respect to the proposed Aditya refinery plant in Odisha and Jharkhand aluminium project due to delays in getting various regulatory approvals and the current uncertain economic environment," D Bhattacharya, Hindalco Managing Director, told reporters while announcing the earnings.
A final decision on this (Rs 16,000 crore investment plans) will be taken in the next three-four months, he said.
Revenue from operations fell to Rs 5,838 crore in the April-June period after a planned shutdown of one of its smelters resulted in lower production, he said.
"The numbers of this quarter were achieved despite adverse macroeconomic headwinds. Our margins are better than peers, though lower metal prices led to a 3 per cent drop in sales revenue compared to the same period of previous fiscal."
On the aluminium business front, the company said the margin squeeze continued.
While London Metal Exchange (LME) aluminium prices dropped around 7 per cent, the rupee depreciation against the dollar negated the impact to some extent.
The Indian market is stagnating due to a slowdown and the cost of production is going up due to higher prices of raw material such as coal, Bhattacharya said.
During Q1, aluminium sales grew 7 per cent to Rs 2,211 crore against Rs 2,063 crore reported a year earlier.