Hindalco Q4 profit seen up 18% at INR 293 cr

Aluminium major Hindalco Industries's fourth quarter profit may rise 18 percent year-on-year to INR 293 crore, according to a CNBC-TV18 poll. The company will announce its earnings on May 28.

Aluminium major Hindalco Industries 's fourth quarter profit may rise 18 percent year-on-year to INR 293 crore, according to a CNBC-TV18 poll. The company will announce its earnings on May 28.

In Q4FY14, the company had a tax credit of INR 46 crore, and exceptional loss of INR 396 crore (related to a liability of INR 324 crore under The UP Tax on Entry of Goods into Local Areas Act, 2007 and liability of INR 72 crore under The Madhya Pradesh Gramin Avsanrachna Tatha Sarak Vikas Adhiniyam).

Total turnover for the quarter is seen declining 1 percent to INR 8,320 crore compared to INR 8,434.2 crore in the year-ago period.

Aluminum volumes may be driven by ramp-up at Utkal refinery and Hirakud and Mahan smelters while copper volumes may come in slightly higher or may be stay flattish.

Analysts feel lower realisations in aluminum may restrict topline growth while copper (which contributes 55 percent to total revenue) may hamper topline. LME copper prices in March quarter fell by 15 percent year-on-year and 10 percent quarter-on-quarter while LME aluminum prices increased 6 percent Y-o-Y and dropped 8 percent on sequential basis.

Operating profit may increase 3 percent year-on-year to INR 870 crore and margin may expand 45 basis points to 10.46 percent in the quarter gone by. Copper EBIT may be strong owing to higher as TC/RC while aluminum EBITDA accretion from incremental volumes could be limited due to high cost of production and ramp up costs at Aditya smelter.

Key issues to watch out for are progress on block won in the recently concluded coal block auction, aluminum price movement & TC/RC trends, and ramp-up of Mahan and Aditya smelters.