Hindalco Q4 results: Net profit doubles to ₹3,851 crore

Aditya Birla Group's flagship metal company Hindalco Industries on Thursday reported a 100% jump in its net profit to ₹3,851 crore in the quarter ended March 2022 compared with ₹1,928 crore in the same period last year.

The aluminium maker's revenue from operations jumped 38% year-on-year to ₹55,764 crore in the fourth quarter compared with ₹40,507 crore in the corresponding period last year.

Hindalco's EBITDA, or earnings before interest, taxes, depreciation, and amortisation, rose 30% year-on-year to ₹7,597 crore in the January-March period compared with ₹5,845 crore in Q4FY21.

The results were aided by an exceptional performance in the company's India business, supported by favourable macros, strategic product mix and an improved downstream business, Hindalco says in an exchange filing.

"With record profitability in the fourth quarter, we had a very good end to the year. We attribute Hindalco's highest-ever profits not just to strong macros, but also our consistent focus on operational excellence and cost optimisation," says Satish Pai, managing director at Hindalco Industries. "We continue to remain one of the world's lowest cost and highest EBITDA margin producers of aluminium."

"We have allocated over 70% of our growth capex to value-enhancing downstream segments. All our growth capex for the next five years will be funded out of internal accruals," adds Pai.

For the full fiscal year, consolidated profit after tax (PAT) jumped nearly four times to ₹13,730 crore, up 294% on a yearly basis.

Consolidated net debt to EBITDA improved significantly to 1.36x on March 31, 2022 compared to 2.59x on March 31, 2021, the aluminium producer says.

Hindalco's subsidiary Novelis reported a 15% year-on-year drop in EBITDA to $431 million compared with $505 million, primarily due to cost inflation, semiconductor chip shortage in automotive and other short-term operational issues, and a non-recurring regulatory provision taken in the quarter. Revenue of the world's largest recycler of aluminium rose 34% year-on-year to $4.8 billion in the January-March period, aided by higher global aluminium prices.

Novelis will invest $2.5 billion to build a new low-carbon recycling and rolling plant in Bay Minette, Alabama. This is the largest global greenfield expansion project of the Aditya Birla Group and will take the group’s total investment in the US across businesses to over $14 billion.

More than half of the capacity of the new facility will be used to serve growing demand for aluminium beverage can sheets in North America, which is driven by consumer preference for more sustainable packaging. Novelis has a 40% global market share in beverage can body stock, where demand remains robust.