Birla goes big: Hindalco plans ₹80,000 crore investment as rivals raise the bar

Billionaire Kumar Mangalam Birla-led global aluminium major Hindalco Industries plans to invest a further ₹80,000 crore over the coming years to double its upstream and downstream aluminium and copper production in India. The massive investment plan comes close on the heels of Vedanta's expansion plans and the Adani Group's foray into the sector with a ₹1.08 lakh crore aluminium project in Odisha.

Hindalco is already in the middle of a ₹50,000 crore investment cycle, of which around ₹20,000 crore has been spent. The remaining ₹30,000 crore, along with a fresh investment cycle of ₹50,000 crore, will help the company strengthen its leadership position in India.

Hindalco reported record quarterly consolidated revenue of ₹91,708 crore in the second quarter, up 39%. Consolidated EBITDA rose 42% to ₹13,757 crore, while consolidated profit jumped 59% to ₹7,533 crore.

Aluminium Upstream reported quarterly EBITDA of ₹7,009 crore, up 55%. EBITDA from non-LME-linked businesses rose 50% to ₹6,860 crore.

Novelis reported a 32% increase in quarterly adjusted EBITDA to ₹4,858 crore. Production at its Oswego plant returned to normal levels following last year's fire, the company said.

India's aluminium industry is entering one of its biggest expansion phases, with Hindalco, the Adani Group and Vedanta competing for a larger share of the growing market. While Adani is entering the upstream segment, covering mining and primary aluminium production, Birla is pursuing an integrated strategy with an emphasis on downstream products catering to the automobile, construction and packaging industries. This approach is expected to help Hindalco navigate the sector's cyclical swings better than its rivals. Around 60% of Hindalco's products are insulated from price movements on the London Metal Exchange (LME).

Last year, Hindalco announced the acquisition of 100% equity in EMIL Mines and Mineral Resources (EMMRL) to secure long-term coal supplies for its aluminium smelting operations. This will enable the company to generate power at a lower cost and protect its margins amid intensifying competition.

The investment wave in aluminium reflects a structural shift in the highly cyclical sector. Demand is being driven by electric vehicles, solar panels, power transmission and distribution infrastructure, even as China's production ceiling tightens global supply. Rising EV production, rapid additions to solar capacity, grid expansion and defence manufacturing are creating sustained demand and prompting producers to significantly expand capacity.

India's aluminium consumption rose around 10% to nearly 6 million tonnes in FY26. Hindalco estimates domestic demand growth at 11-12% during the year, driven by the electrical and automotive sectors and supported by infrastructure spending. The central government is targeting annual aluminium production capacity of 8.5 million tonnes (MT) by FY30, almost double the current 4.2 MT.

The newest challenger, the Adani Group, has proposed a project comprising a 4 MT alumina refinery, a 2 MT aluminium smelter, a 4,000-megawatt (MW) captive power plant, including 400 MW of green power, and a 1 MT downstream manufacturing park.

Vedanta, India's largest primary aluminium producer, is equally aggressive. Last year, it announced a ₹1 lakh crore investment to set up a 6 MT alumina refinery and a 3 MT aluminium plant powered by renewable energy in Odisha. The Adani Group, through Adani Enterprises Limited (AEL), is developing a ₹1.08 lakh crore integrated greenfield aluminium project in Odisha in a joint venture with International Resources Holding (IRH), an Abu Dhabi-based natural resources investment platform.

Vedanta is also moving up the value chain. High-margin value-added products already account for around 60% of its aluminium sales, the company had said earlier. It aims to increase this share to 90%.

Hindalco, the metals flagship of the Aditya Birla Group, is pursuing a comprehensive aluminium strategy, seeking to balance upstream production with higher-margin downstream businesses.

The investment push in India is gathering momentum amid favourable global market dynamics. Aluminium prices on the London Metal Exchange (LME) climbed sharply through FY26, supported by US tariffs, China's production nearing its statutory 45 MT cap and geopolitical disruptions following the Iran war. Prices touched multi-year highs of around $3,400 per tonne in March and reached $3,675 in May before declining to the current level of $3,070.

The Indian government projects domestic aluminium demand to rise to 8.5 MT by FY30, 18 MT by FY40 and 28 MT by FY47.