UPDATE 1-Hindalco Sees India Aluminium Demand Growth Surge-Shanghai Metals Market

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UPDATE 1-Hindalco Sees India Aluminium Demand Growth Surge

Industry News 09:00:48AM Jun 09, 2010 Source:SMM

MUMBAI, June 9 -- India's top aluminium maker, Hindalco Industries (HALC.BO: Quote), sees domestic demand posting double-digit growth in the current fiscal year, outpacing a modest rise in North America and Europe, a top official said.

Hindalco, part of the diversified Aditya Birla group, last week said 2009/10 net profit had surged although net sales declined as a global economic slowdown hit demand.

"Aluminium demand in India is very positive because of auto, construction and electricals sectors. Even globally, I would be very surprised if aluminium prices come down from current levels," Managing Director Debu Bhattacharya told reporters.

"Copper demand is also rising on the back of power projects."

On Tuesday, benchmark aluminium for three-months delivery CMCU3 on the London Metal Exchange traded at $1,882 a tonne, up about a third from a year ago, but nearly half of its peak in late 2008.

Benchmark copper contracts CMCU3 were at $6115 a tonne, near eight-month lows.

World aluminium demand fell about 8 percent in 2009 as the global slowdown hit demand for raw materials in the automotive and construction sectors

But demand is likely to rise about 14 percent in 2010, mainly on rising consumption in the rapidly expanding economies of China and India.

Hindalco, which gets about 40 percent of its India revenue from aluminium, is trebling capacity in India to 1.9 million tonnes by 2013 at a cost of about $5 billion.

Aluminium rolled products maker Novelis, which Hindalco acquired in 2007, will mainly see growth in the South American and Asian markets.

Earlier this year, Novelis Chief Operating Officer Philip Martens told Reuters he expected global demand for aluminium to rise about 4 percent in 2010, with emerging markets driving growth.

Bhattacharya said Novelis would invest $150 million in 2010/11 on capital expenditure, with a significant amount going into expanding rolling operations in Brazil, likely to be completed by late 2012.

Hindalco is also looking to acquire copper mines, as it seeks to secure a higher percentage of its raw material supplies and hedge against price volatility. "Our objective is to have 40 percent of our concentrate requirement coming from our own mines. We are still short of that," Bhattacharya said.

He said the company was in talks to acquire copper mines, but declined to give details on their location or size.

Hindalco already operates copper mines in Australia under its Aditya Birla Minerals unit, but these account for only a quarter of its concentrate requirements.

Shares in the company, valued at $5.7 billion, closed 5.8 percent lower at 132.20 rupees in a weak Mumbai market .BSESN that ended 1 percent lower.

The stock has declined nearly 18 percent so far in 2010, underperforming the 5 percent decline in the main index. ($1=46.9 rupees)

 

Key Words:  Aluminum Al  Hindalco 

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UPDATE 1-Hindalco Sees India Aluminium Demand Growth Surge

Industry News 09:00:48AM Jun 09, 2010 Source:SMM

MUMBAI, June 9 -- India's top aluminium maker, Hindalco Industries (HALC.BO: Quote), sees domestic demand posting double-digit growth in the current fiscal year, outpacing a modest rise in North America and Europe, a top official said.

Hindalco, part of the diversified Aditya Birla group, last week said 2009/10 net profit had surged although net sales declined as a global economic slowdown hit demand.

"Aluminium demand in India is very positive because of auto, construction and electricals sectors. Even globally, I would be very surprised if aluminium prices come down from current levels," Managing Director Debu Bhattacharya told reporters.

"Copper demand is also rising on the back of power projects."

On Tuesday, benchmark aluminium for three-months delivery CMCU3 on the London Metal Exchange traded at $1,882 a tonne, up about a third from a year ago, but nearly half of its peak in late 2008.

Benchmark copper contracts CMCU3 were at $6115 a tonne, near eight-month lows.

World aluminium demand fell about 8 percent in 2009 as the global slowdown hit demand for raw materials in the automotive and construction sectors

But demand is likely to rise about 14 percent in 2010, mainly on rising consumption in the rapidly expanding economies of China and India.

Hindalco, which gets about 40 percent of its India revenue from aluminium, is trebling capacity in India to 1.9 million tonnes by 2013 at a cost of about $5 billion.

Aluminium rolled products maker Novelis, which Hindalco acquired in 2007, will mainly see growth in the South American and Asian markets.

Earlier this year, Novelis Chief Operating Officer Philip Martens told Reuters he expected global demand for aluminium to rise about 4 percent in 2010, with emerging markets driving growth.

Bhattacharya said Novelis would invest $150 million in 2010/11 on capital expenditure, with a significant amount going into expanding rolling operations in Brazil, likely to be completed by late 2012.

Hindalco is also looking to acquire copper mines, as it seeks to secure a higher percentage of its raw material supplies and hedge against price volatility. "Our objective is to have 40 percent of our concentrate requirement coming from our own mines. We are still short of that," Bhattacharya said.

He said the company was in talks to acquire copper mines, but declined to give details on their location or size.

Hindalco already operates copper mines in Australia under its Aditya Birla Minerals unit, but these account for only a quarter of its concentrate requirements.

Shares in the company, valued at $5.7 billion, closed 5.8 percent lower at 132.20 rupees in a weak Mumbai market .BSESN that ended 1 percent lower.

The stock has declined nearly 18 percent so far in 2010, underperforming the 5 percent decline in the main index. ($1=46.9 rupees)

 

Key Words:  Aluminum Al  Hindalco