What was the reason for the profits of Hindalco doubling in the March 2022 quarter?

Hindalco, part of the Aditya Birla group, saw good traction in both its key businesses viz. the global Novelis business and also the India aluminium business. In the last few years, the company has made a conscious shift towards value added products and that has enabled the company to focus more on the higher margin business. For the March 2022 quarter, Hindalco has doubled its net profits to Rs3,851 crore for March 202 quarter.

What is more interesting about the Hindalco numbers is that the actual profits are almost 30% higher than street consensus estimates, which was below Rs3,000 crore. In terms of the top line revenues, it was up 38% for Q4FY22 at Rs55,764 crore. Aluminium demand has been robust in the last few quarters but the big thrust to the top line has come from the very strong price moves in aluminium, as evidenced by trends on London Metals Exchange.

For the quarter ended March 2022, the EBITDA grew 30% at Rs7,598 crore. This EBITDA growth was principally boosted by the 120% EBITDA growth of the India aluminium business. EBITDA margins of the India business were at 41%. The international Novelis business also saw net income grow by 21% yoy. Hindalco has expanded its capital expenditure (capex) commitments for the year to $3.4 billion.