(Reuters) – Hindalco Industries, one of India’s largest aluminium and copper producers, reported a better-than-expected third-quarter profit on Thursday, helped by higher aluminium prices.
The Aditya Birla Group-owned company’s consolidated net profit surged 60.2% to 37.35 billion rupees ($429.5 million) in the quarter ended December 31.
Analysts, on average, had expected 35.73 billion rupees profit, per data compiled by LSEG.
Hindalco’s India aluminium business helped mitigate the impact of lower margins at its U.S.-based unit Novelis, with aluminium prices rising for the third straight quarter in the October-to-December period.
Prices for the benchmark three-month aluminium and copper on the London Metal Exchange rose 17% and 13% in the third quarter from a year ago, respectively.
Higher commodity prices push up metal selling prices, resulting in better profit margins.
Hindalco’s revenue from operations rose 10.6% to 583.90 billion rupees, while total expenses increased 7.6% to 535.63 billion rupees.
Revenue from IPO-bound aluminium recycler Novelis, which accounts for more than 56% of Hindalco’s overall revenue, rose 5.2%.
“Continued strong demand for beverage packaging sheet was offset by lower automotive and specialty shipments,” Novelis said on Monday.
The copper segment, the second-largest contributor to Hindalco’s revenue, grew nearly 15% during the quarter, on higher copper prices.
The company named Bharat Goenka as chief financial officer, effective April 1.
Commodity price rise also helped rivals Vedanta and NALCO to beat profit estimates for the third quarter.
Hindalco’s shares closed 0.6% higher ahead of the results.
($1 = 86.9580 Indian rupees)
(Reporting by Anuran Sadhu in Bengaluru; Editing by Savio D’Souza and Mrigank Dhaniwala)
