Thought leadership: Q4 results: Views of Managing Director of Hindalco Industries Satish Pai on their performance

Hindalco Ltd gave a robust Q4 performance - MD, Satish Pai, and spoke about the Q4 results and future prospects in an interview with Bloomberg. Here’s what he said:

Satish Pai started by saying that he was confident about the numbers and expects them to continue to be the same for the upcoming quarters. He added that Novelis, Hindalco’s subsidiary which could not perform upto its mark due to the supply chain semi-conductor issues will bounce back strongly in Q1FY23. Regarding Novelis, he said, they are pretty confident about maintaining the 500 dollars per ton EBITDA. 

From the cost pressure point of view, his main concern is the coal prices and its availability. They are expecting a mid-teens increase in its Indian aluminium division’s fully integrated costs in FY23.  

Satish Pai said, that the copper division will see steady growth as the operational issues have been sorted and there is a surge in demand. He added that Q1FY23 will be a good quarter for the copper division. 

Regarding capex, he said that in March, they had announced an 8 billion capex plan for both Novelis and India, for the next 5 years. He said that they announced that because the company has a strong balance sheet and its Net Debt/ EBITDA ratios are also under control. The company has repaid most of its debt and is capable of generating a lot of cash going forward. The capex plan is mainly focused on the organic growth of value-added dark space.  

Satish Pai said that Novelis has managed to repay all of its debt and since they are generating a lot of cash, most of it will be utilized for organic growth and after that, it will go to the shareholders in form of dividends. The company has increased its dividend to Rs 4. 

Overall, the company has debt under control and is aiming for better expansion plans in the upcoming quarters.