Hindalco Q1 net profit jumps 75% to record Rs 7,013 crore; stock gains

Hindalco Industries, the Aditya Birla Group's metals flagship, reported a 75% jump in consolidated net profit for the first quarter of FY27, touching a record Rs 7,013 crore. Revenue for the April-June period climbed 32% to Rs 23,678 crore, helped by strong aluminium prices and a rebound at its US-based downstream unit Novelis.

The results, announced on Friday, sent the company's shares up nearly 3% in early trade on the National Stock Exchange. Investors appeared to cheer both the earnings beat and the outlook provided by management, even as cost pressures loom in the coming quarters.

Aluminium supply shock and Novelis recovery drive earnings

The company attributed the record performance to what it described as an aluminium supply shock in global markets, which has kept prices elevated. Hindalco's India aluminium business benefited from higher realisations, while volumes remained steady across its smelting and downstream operations.

Novelis, the Atlanta-based rolled products subsidiary, also staged a strong comeback during the quarter. After facing headwinds in previous quarters, the unit's performance improved, contributing meaningfully to the consolidated numbers. Analysts said the recovery in Novelis was a key factor behind the sharp profit growth.

Cost trajectory: Q2 to see 4-5% rise, peak in September

Managing Director Satish Pai, in a post-earnings interaction, flagged that input costs are expected to rise 4-5% sequentially in the second quarter. He indicated that costs are likely to peak in the September quarter before easing thereafter.

Pai's comments provide some clarity on the near-term margin outlook. While aluminium prices remain supportive, rising coal, caustic soda and other input costs could temper earnings growth in the current quarter. The company did not specify the exact quantum of the impact on profitability.

Revenue growth across segments

Revenue growth was broad-based, with both the India aluminium business and Novelis contributing. The copper segment, another key vertical for Hindalco, also posted steady numbers, though it was the aluminium operations that stole the show.

The company's consolidated EBITDA also saw a significant uptick, reflecting operational leverage and better product mix. Hindalco's balance sheet remains strong, with net debt levels under control, according to analysts tracking the company.

Stock reaction and market response

Shares of Hindalco rose as much as 3% in morning trade on the NSE, before paring some gains. The stock has been on a solid run over the past year, supported by favourable aluminium prices and the company's aggressive capacity expansion plans.

Brokerages largely maintained positive ratings on the stock post-results, citing the record profit and the outlook for aluminium demand. Some, however, flagged the cost pressure in Q2 as a near-term overhang.

Hindalco's performance comes at a time when global aluminium markets are tight, with supply disruptions in several producing regions. The company said it remains focused on operational efficiencies and value-added products to navigate cost inflation.

Looking ahead, investors will watch how the September quarter plays out, particularly the trajectory of input costs and whether aluminium prices hold at current levels. The company's commentary on capex and deleveraging plans will also be in focus in the coming months.