India's NALCO smashes third-quarter profit estimates on lower costs

National Aluminium

13/02/2024 15:42

BENGALURU, Feb 13 (Reuters) - India's National Aluminium
Company (NALCO)  NALU.NS  topped third-quarter profit estimates
on Tuesday, helped by lower raw material and fuel costs.
    Consolidated profit soared almost 84% to 4.71 billion Indian
rupees ($56.7 million) for the quarter ended Dec. 31 from a year
earlier, smashing analysts' expectation of 2.72 billion rupees.
    Prices of thermal coal, a key material used as fuel for
metal firms, were down in the quarter, helping cut NALCO's power
and fuel costs down almost 23%.
    This, coupled with a nearly 26% decline in raw material
costs, led to the company's total expenses dropping almost 9% to
27.3 billion rupees.
    Aluminium is used in making a variety of products - from car
bodies to electric cables and food wrapping foil - due to its
light-weight and ability to be formed into sheets and wires.
    Prices of the metal were down from a year earlier, while
some metals' manufacturing activity fell in the quarter, which
analysts attributed to a seasonal slowdown.
    As a result, NALCO's mainstay, the aluminium segment,
notched a 4% decline in revenue.
    The company's modest 4% total revenue growth to 33.47
billion rupees was on the back of 11.6% growth in its chemicals
business.
    Aluminium accounts for about 60% of the company's total
revenue, while chemicals comprises the rest.
    Rival Hindalco  HALC.NS  missed third-quarter profit
estimates earlier on Tuesday.

($1 = 83.0775 Indian rupees)

 (Reporting by Hritam Mukherjee and Varun Vyas in Bengaluru;
Editing by Subhranshu Sahu and Maju Samuel)
 ((Hritam.Mukherjee@thomsonreuters.com; X: @MukherjeeHritam;))