Earnings Outlook
Strong pricing, Novelis to boost Hindalco March earnings
This story was originally published at 17:53 IST on 16 May 2025
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By Narayana Krishna
HYDERABAD - Higher aluminium prices and improved performance by Hindalco Industries Ltd.'s US subsidiary Novelis Inc. are likely to see Hindalco's consolidated earnings for the March quarter grow, according to analysts.
The Aditya Birla group's flagship metal company is expected to report a consolidated net profit of INR 45.6 billion, up 44% on year and 22% sequentially, according to an average of estimates from 11 brokerages. The company's revenue for the quarter is seen growing 10% on year and 6% on quarter to INR 617.2 billion, the estimates show.
Analysts' estimates for Hindalco's March quarter net profit range from a low of INR 38.7 billion, projected by ICICI Securities Ltd., to a high of INR 55.2 billion, estimated by Nuvama Wealth Management Ltd. Revenue estimates range from the lowest of INR 582.8 billion by Yes Securities (India) Ltd. to the highest of INR 665.6 billion by Anand Rathi Share and Stock Brokers Ltd.
For the March quarter, average aluminium prices were up 19% on year and 2% on quarter on the benchmark London Metal Exchange — one of the key factors for Hindalco's earnings growth — Axis Securities Ltd. said in its pre-earnings note. Average alumina prices stood at $523 per tonne, up 44% on year due to the lingering impact of supply issues, Axis Securities said.
Most analysts also expect Novelis to report a decent growth for the quarter, led by higher metal prices. Novelis accounts for nearly 60% of Hindalco's consolidated revenue and has a significant influence on the company's financial performance.
Hindalco's India aluminium operations are likely to benefit from healthy aluminium prices and a steady higher volume trend, Elara Securities (India) Pvt. Ltd. said. Elara expects higher aluminium prices, coupled with volume growth of 1% on year and 6% on quarter, to help Novelis register 23% sequential growth in its earnings before interest, tax, depreciation, and amortisation per tonne.
The average of estimates from nine brokerages for Hindalco's EBITDA is pegged at INR 83.99 billion. Emkay Global Financial Services Ltd. projected Novelis's EBITDA at $468 million in the March quarter, up 27% from $367 million in the December quarter. EBITDA per tonne for Novelis is expected to increase 21% sequentially to $490 per tonne, primarily led by increased volumes, according to Emkay Global.
Kotak Institutional Equities projects Hindalco's India operations' March quarter EBITDA to rise 47% on year to INR 46.6 billion, while Novelis's EBITDA for the quarter is seen at $461 million, down 10.2% on year. EBITDA margin for the quarter is seen at 14.4%, up 216 basis points on year and 102 bps on quarter, Kotak said. Yes Securities expects the company to report an EBITDA of INR 75.2 billion, up 12.7% on year and down 0.7% on quarter.
According to Axis, EBITDA margin is set to improve 47 basis points on year on account of easing coal costs at Indian operations, but it would contract 33 bps due to lower Novelis EBITDA.
Talking of the company's copper business, which accounts for nearly 22% of total revenue, analysts project a drop in its copper volumes for the March quarter due to a high base, thereby impacting its EBITDA growth. Kotak expects an 11.5% on-year fall in copper business EBITDA to INR 6.9 billion.
The company is scheduled to announce its March quarter earnings Tuesday.
Analysts are keenly watching the progress of Hindalco's expansion plans and its recent entry into the auto components business. Market participants are also looking for the company's commentary on the impact of tariffs on Novelis's operations.
On Friday, shares of Hindalco Industries ended at INR 657.55 on the National Stock Exchange, down 0.6% from its previous close. The stock has risen nearly 9% since the company has released its December quarter results on Feb. 13.
Following are the Jan-Mar earnings estimates for Hindalco Industries Ltd. based on reports from 11 brokerage firms in descending order by the estimate of net profit:
Brokerage name | Net Sales | Net Profit | EBITDA |
| --in million rupees-- | ||
Nuvama Wealth Management Ltd | 6,20,600.00 | 55,200.00 | 91,100.00 |
Anand Rathi Share and Stock Brokers Ltd | 6,65,608.00 | 54,245.00 | -- |
Prabhudas Lilladher Pvt Ltd | 6,48,700.00 | 51,100.00 | 86,300.00 |
Kotak Institutional Equities | 5,96,329.00 | 47,335.00 | 85,764.00 |
Elara Securities (India) Pvt Ltd | 6,15,013.00 | 45,346.00 | 86,230.00 |
Systematix Shares and Stocks (India) Ltd | 6,24,500.00 | 43,900.00 | 86,700.00 |
Motilal Oswal Financial Services Ltd | 5,88,400.00 | 42,800.00 | 77,800.00 |
Emkay Global Financial Services Ltd | 6,11,853.10 | 42,287.30 | 84,640.20 |
Axis Securities Ltd | 6,29,600.00 | 40,980.00 | 79,850.00 |
YES Securities (India) Ltd | 5,82,781.00 | 39,559.00 | -- |
ICICI Securities Ltd | 6,05,426.00 | 38,654.00 | 77,518.00 |
Average | 6,17,164.55 | 45,582.39 | 83,989.13 |
End
US$1 = INR 85.50
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Deepshikha Bhardwaj
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