Hindalco net profit slips to Rs 357 crore in Q2

Hindalco Industries, an aluminium and copper producer being investigated for a coal block jointly allocated to it, reported a smaller-than-expected quarterly profit as prices fell due to production outpacing demand.

Three-month aluminium prices on the London Metal Exchange averaged 5 per cent lower in the July-September quarter from a year earlier, while copper prices averaged about 8 per cent lower.

"The long spell of subdued LME has adversely affected the global aluminium industry and its margins and production levels significantly," Hindalco, which is India's No. 2 aluminium and copper producer, said in a statement.

Second-quarter net profit fell marginally to Rs 357 crore from Rs 359 crore a year earlier. Revenue rose 2 per cent to Rs 6,305 crore.

Analysts were expecting a profit of Rs 383 crore on revenue of Rs 6,764 crore, according to Thomson Reuters I/B/E/S.

Hindalco unit Novelis Corp, the world's top maker of rolled aluminium sheets, said on Monday net income for the April-September period sank 74 per cent due to overcapacity in the North American beverage can market.

Hindalco and its chairman, billionaire Kumar Mangalam Birla, are under the scrutiny of the Central Bureau of Investigation (CBI) as part of a probe to find out if there were irregularities in awarding coal blocks to various companies over the past two decades. The company has denied any wrongdoing.

The company's shares, which have lost a fifth of their value this year, fell slightly after the results. They were up more than 2 per cent earlier on Tuesday.

($1 = 63.2750 rupees)

Copyright Thomson Reuters 2013