Hindalco posts 45% fall in quarterly profit on higher costs
- Hindalco said the fire at Novelis would hit its 2026 cash flow by $1.3 billion to $1.6 billion
India’s Hindalco Industries posted a 45% fall in its third-quarter profit on Thursday despite firmer aluminium and copper prices, weighed down by expenses linked to fire-related disruptions at its U.S. unit Novelis.
The Aditya Birla Group-owned metals producer reported a consolidated net profit of 20.49 billion Indian rupees ($226.14 million) for the three months ended December 31, compared with 37.35 billion rupees a year earlier.
The decline was largely due to 26.10 billion rupees of exceptional expenses tied to a plant disruption in Oswego, New York.
Its U.S.-based subsidiary Novelis, which supplies rolled aluminium to beverage can makers and automakers, was impacted by a fire at its New York plant last year.
The results come a day after Hindalco said the fire at Novelis would hit its 2026 cash flow by $1.3 billion to $1.6 billion, with the company targeting a restart towards the end of the second quarter.
The company’s consolidated revenue rose 14% to 665.21 billion rupees, supported by a strong performance in the India business, higher copper sales and growth in value-added aluminium products.
India’s Hindalco sees up to $1.6 billion impact from fire at unit’s New York plant
Global aluminium prices remained supported during the quarter amid supply constraints and steady demand from the automotive, packaging and infrastructure sectors.
Domestic demand for non-ferrous metals was also aided by government-led infrastructure spending and manufacturing growth.
In India, Hindalco’s copper segment saw a 33% rise in revenue, while its aluminium upstream and downstream businesses grew 6% and 22%, respectively.
Managing Director Satish Pai said that Novelis’ performance is expected to improve in the fourth quarter and fully recover next year after the Oswego facility restarts in June.
Strong performance in the India business helped stabilise overall earnings during the disruption, Pai said in a post-earnings call, adding that underlying margins have already stabilised.
Earlier in the day, analysts at Jefferies said in a note that fire-related disruption weighed on Novelis’ December-quarter performance, leading to idle capacity, higher costs and lower shipments.
Ambit Capital also flagged earnings pressure from the plant outage, citing repair expenses, fixed costs and supply disruptions.
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