Hindalco Q4FY22 Results: Profit rose 100% YoY at Rs 3,851 crore; declares dividend at Rs 4 per share

Hindalco Industries Limited (Hindalco) on Thursday reported a 100 per cent year-on-year (YoY) rise in its consolidated net profit of Rs 3,851 crore for the fourth quarter ended March 2022. It had posted a profit of Rs 1,928 crore in the corresponding quarter of the previous financial year.

On a sequential basis, the profit increased 4.8 per cent from Rs 3,675 crore earned during the previous quarter ended December 31, 2021.

The consolidated revenue of the company rose by 37.7 per cent YoY to Rs 55,764 crore in the period under consideration compared to a revenue of Rs 40,507 crore registered in the year-ago quarter. On a sequential basis, the revenue of one of the largest metals companies in India rose 11 per cent from the net revenue of Rs 50,272 crore recorded in the previous quarter.

Mr. Satish Pai, Managing Director, Hindalco Industries, said, "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 to our consistent focus on operational excellence and cost optimization. We continue to remain one of the world's lowest-cost and highest EBITDA margin producers of aluminium. Our strategy to build a more sustainable business model that is isolated from metal cycles is working very well for us. In line with this, we have allocated over 70 per cent 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."

He further added, "Our growth strategy will continue to be shaped by our 2050 ESG goals – achieving Net Zero in carbon emissions, effluent discharge, biodiversity loss and waste to landfill. To sum up, Hindalco sees a positive horizon which inspires us to invest in future-centric growth projects."

Business Segment Performance in Q4 FY22 (vs Q4 FY21)

Novelis

Novelis reported quarterly adjusted EBITDA of $431 million (vs $505 million), down 15 per cent YoY, primarily due to cost inflation, semiconductor chip shortage in automotive and other short-term operational issues, and a non-recurring regulatory provision was taken in the quarter. Novelis reported an Adjusted EBITDA per ton of $437 in Q4 FY22, compared to $514 in the prior year.

Novelis' Net Income from continuing operations was $217 million, up 21 per cent YoY, mainly driven by lower interest expense in Q4 FY22. Revenue was $4.8 billion (vs $3.6 billion), up 34 per cent YoY, driven by higher global aluminium prices. Total shipments of flat-rolled products (FRPs) were up at 987 Kt vs 983 Kt in Q4 FY21.

Aluminium India

EBITDA was at an all-time high of Rs 4,050 crore in Q4 FY22, compared with Rs 1,819 crore for Q4 FY21, an increase of 123 per cent YoY, primarily due to favourable macros, higher volumes, better operational efficiencies, and improved performance of downstream business offset by higher input costs. EBITDA margins were at 41 per cent and continue to be the best in the industry. Revenue was Rs 9,847 crore in Q4 FY22 vs Rs 5,969 crore in the prior-year period. Aluminium India Business recorded metal production of 326 Kt vs 316 Kt in the corresponding quarter. Aluminium metal sales were up 2 per cent YoY at 336 Kt vs 329 Kt in the prior year.

Aluminium VAP (excluding wire rods) sales volumes were at a record 93 Kt (vs 92 Kt), up 1 per cent YoY, driven by the recovery of the domestic market. VAP sales, as a percentage of total metal sales, were at 28 per cent this quarter which was the same as the prior year's quarter

Copper

Copper Cathode production was at 94 Kt in Q4 FY22 (vs 97 Kt in Q4 FY21) while copper rod production was 69 Kt in Q4 FY22 (vs 76 Kt in Q4 FY21). Overall copper metal sales were at 105 Kt (vs 107 Kt in Q4 FY21), Copper Continuous Cast Rod (CCR) sales in Q4 FY22 were up 2 per cent YoY, at 74 Kt (vs 73 Kt in Q4 FY21). EBITDA for the business stood at Rs 387 crore in Q4 FY22 compared to Rs 322 crore in Q4 FY21, up 20 per cent YoY, on the back of better operational efficiencies and improved by-product realisations. Revenue from the Copper Business was Rs 9,787 crore this quarter, up 15 per cent YoY, primarily due to higher global prices of copper and higher volumes.

Besides, the Board of Directors of the company has recommended a dividend at Rs 4 per equity share (400% of the face value of Re 1/- each) for the year ended March 31, 2022, subject to the approval of shareholders at the ensuing Annual General Meeting of the Company.