HINDALCO: Ambassador of Indian Aluminium industry to the world

In the year 1958, Hindalco Industries started with an aim to produce primary aluminium and brownfield expansion, whereas, from 2020 onwards, Hindalco has grown through acquisitions and FDI investments. The primary aluminium business generated non-uniform cash-flow due to the fluctuation in the international prices.

Hindalco planned to de-risk, so it increased the share of the downstream activities and in 2007 Hindalco acquired Novelis, the world’s largest aluminium rolling company for around $6 billion, followed by more downstream investments in India. In 2020 Hindalco acquired Aleris to build competency in aluminium rolled products.

Hindalco also invested about $5 billion in upstream projects which incorporates the aluminium smelting and alumina refinery facilities and focus on the security of raw materials. The de-risking strategy has given a positive outcome, while aluminium prices have been depressed; the downstream business has generated good cash-flow.

Hindalco is the solitary provider for many of India’s high-end aluminium downstream products for defence, aerospace, transportation, pharmaceuticals and food packaging, electronics, and construction.

Hindalco stands as the world’s largest aluminium rolled products manufacturer, especially in beverage cans and auto body and with the acquisition of Aleris, the company produces aerospace-grade aluminium sheets. The company is building potentiality in India to be a part of the country’s growth and be part of Self-reliant India’s scheme with a focus on defence, electric vehicles, high-speed trains, smart cities, electronics manufacturing.

Coal and bauxite assorted takes over 75% of aluminium production cost. India has abundant coal and good quality bauxite and with government support, it can drive to be the leader of the world aluminium. However, taxes and duties account for 17% of production cost; interest and logistics costs also remains high.