Hindalco profit down 67 per cent on high finance and depreciation cost

MUMBAI: Hindalco Industries reported a net profit of Rs. 107.19 crore for the quarter ended June, against a profit of Rs. 327.50 crore in the year-ago quarter, hurt by high finance and depreciation costs.

Sales rose 7 per cent to Rs. 8517.29 crore during the quarter. Analysts were expecting a profit of Rs. 155.67 crore on revenue of Rs.8968.54 crore, according to a Bloomberg poll. Finance cost shot up 78 per cent to Rs. 601.68 crore, while depreciation and amortization costs went up 77 per cent to Rs. 331.99 crore on account of commissioning of new greenfield projects.

Hindalco said the aluminium business suffered due to lower realization despite higher volumes. The company added going ahead it expects operational performance to be strong with the ramp up of new aluminium making facilities but cautioned that adverse metal realization may pose significant turbulence in the near future.

Credit rating agency recently downgraded the company one notch, citing rising cost of production.

Hindalco shares were trading up 3 per cent at Rs 93.70 apiece on BSE on Friday.