Economy slowdown in India lowers aluminium demand by 6% in Q2 2019: Satish Pai

In a recent interview with The Economic Times, Satish Pai, the managing director of Hindalco, pointed out that the economy slowdown in India impacted domestic businesses, as a result of which, aluminium demand fell 6 per cent in the second quarter, affecting Hindalco’s business. 

Mr Pai also said the aluminium demand, which he expected to grow by 2 per cent to 3 per cent, remained low throughout the construction and infrastructure, and the automobile sector.

According to him, Hindalco sell about 328,000 tonnes of extrusions in a quarter, of which 5 per cent accounts for the auto sector, 40 per cent for the electrical sector, 10 per cent to 15 per cent for the transportation sector, and another 20 per cent for packaging.

What fears him is that despite the downfall in aluminium demand in the country, the imports are still at 60 per cent and scrap at more than 50 per cent of those imports. However, they have already cautioned the government of the possible rise in imports, especially from China, and the government has also taken cognisance of the fear.

Pai said that despite the fall in aluminium demand in India, Hindalco’s production remained unaffected and so the cost of production. Pai added Hindalco had sales of 328 KT.

While talking about the incident in Muri, Pai also said that Hindalco was hoping to reopen the alumina plant in Muri this quarter.

Novelis aluminium sheet supplies to can and auto makers remained unaffected as well, said Pai, thanks to the anti-plastic movement and the growing demand for electric vehicles.

Besides, Novelis is expected to close the Aleris acquisition deal by January 21, 2020. The sale of the Duffel plant in Belgium is also far advanced and is expected to be finalised by November, said Pai.