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India's Hindalco misses first-quarter profit estimates on higher expenses
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India's Hindalco misses first-quarter profit estimates on higher expenses
Aug 13, 2024 2:39 AM

BENGALURU, Aug 13 (Reuters) - India's Hindalco

on Tuesday reported first-quarter profit below estimates, hurt

by a jump in expenses tied to disruptions at its Novelis unit's

Switzerland plant.

Consolidated net profit for the Aditya Birla Group-owned

company surged 25% to 30.74 billion rupees (about $366 million).

Analysts, on average, expected a profit of 36.71 billion rupees,

according to LSEG data.

Novelis, which accounts for more than 60% of the

firm's overall revenue, incurred a net cash impact of $80

million from the shutdown of its Switzerland-based plant, it

said in a statement. Hindalco's total expenses grew over 4% to

522.61 billion rupees.

However, its bottom line still grew on strong sales and

higher product prices from Novelis and its second-biggest

business, copper.

During the quarter, global prices of base metals including

aluminium and copper saw a sharp uptick amid supply shortages

and rising demand, analysts said.

For the quarter, benchmark aluminium and copper

prices on the London Metal Exchange rose 8% and 8.3%,

respectively.

Higher commodity prices tend to raise selling prices and

margins for miners.

Peers Vedanta and NALCO also reported

higher profit, benefiting from a rise in prices.

Pre-tax profit at the IPO-bound Novelis jumped 21% to 41.7

billion rupees, buoyed by steady demand in its beverage

packaging shipments and higher prices, it said in a statement.

Hindalco's revenue from operations grew nearly 8% to 570.13

billion rupees, while its copper business reported a 16% growth

in revenue.

($1 = 83.9370 Indian rupees)

(Reporting by Manvi Pant in Bengaluru; Editing by Mrigank

Dhaniwala and Devika Syamnath)

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