India's NALCO's reports 76% jump in profit on shrinking costs, higher aluminium prices

National Aluminium

12/08/2024 10:45

BENGALURU, Aug 12 (Reuters) - India's National Aluminium
Company (NALCO)  NALU.NS  reported a 76% jump in first-quarter
profit on Monday as the company benefitted from shrinking costs
and higher prices for the metal.
    The state-owned firm's consolidated profit jumped to 5.88
billion rupees (about $70 million) year-on-year for the three
months ended June 30. 
    Global prices of base metals, including aluminium, rose
sharply during the quarter due to supply concerns and rising
demand, analysts said. 
    Higher commodity prices tend to raise the selling price of
metals, which help boost miners' margins. 
    The company reported a 35% decline in the cost of thermal
coal and bauxite - key raw materials for aluminium. Its
expenses, as a result, fell 24%. 
    However, its revenue from operations fell 10% to 28.56
billion rupees, owing to a 27% drop in its chemicals business,
its second-biggest segment. 
    While the company's mainstay aluminium business contributed
to nearly 90% of overall revenue, it grew a mere 4% during the
quarter. 
    Going forward, domestic aluminium demand growth is expected
to remain steady due to strong demand from the electrical,
building and construction sectors and a demand recovery in
consumer durables, Sumit Jhunjhunwala, assistant vice president
and sector head of corporate ratings at ICRA, said. 
    Rival firm Vedanta  VDAN.NS  beat first-quarter profit
estimates on higher aluminium prices, while Hindalco  HALC.NS 
is set to report quarterly results later this week. 


($1 = 83.9554 Indian rupees)

 (Reporting by Manvi Pant in Bengaluru; Editing by Sonia Cheema)
 ((Manvi.Pant@thomsonreuters.com; +918447554364;))