Hindalco shares slip on share sale plan

Shares of Hindalco Industries slipped on Tuesday amid reports that the company was planning to raise about $500 million through a share sale to reduce debt after a robust performance of the stock all through 2016.

Shares of the aluminium maker have risen 97.41 per cent to INR 167 since the beginning of the calendar year till November 7. The scrip was trading at INR 84.85 on January 1, 2016. The benchmark BSE Metal index has gained 40.41 per cent during this period.

The metal flagship of the Aditya Birla Group is ‘relentlessly focused on deleveraging’ in the short term, Hindalco Managing Director Satish Pai said on an August earnings call with analysts.

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Reacting on the news, shares of the company wiped off the initial gains and traded 0.36 per cent down at INR 166.90 in late afternoon trade on Tuesday. The scrip had opened the day at INR 169 against the previous close of INR 167.

Promoters held around 37.69 per cent stake in the company as of September 30, 2016, whereas the public holding stood at 62.31 per cent.

According to the report, the Mumbai-based producer of copper and alumunium has shelved a plan for share sale to institutional investors for as much as INR 5,000 crore ($750 million) in 2014 because of uncertainty over its access to cheaper raw materials.

The company is scheduled to announce its earnings for the quarter ended September 30, 2016 on November 12. For the quarter ended June 30, 2016, Hindalco reported net profit of INR 294.07 crore, up 174.34 per cent compared with INR 107.19 crore reported for in the corresponding quarter last year.