Aditya Birla Group flagship company Hindalco Industries has refinanced loans worth Rs 7,000 crore to ease debt obligations on its Mahan smelter project, Debnarayan Bhattacharya, managing director, Hindalco Industries, told FE in an interview. The company’s bankers have extended the loan tenure, but Bhattacharya did not elaborate any further.
On a consolidated basis, Hindalco’s net profit for FY15 fell to Rs 854 crore from Rs 2,175 crore in FY14 on account of higher interest costs and exceptional items. Interest cost was up 55% at Rs 4,178 crore in FY15. The higher finance costs are on account of the commissioning of its two greenfield projects —Mahan and Aditya smelters.
The aluminium company’s website notes that the Mahan smelter, located in Madhya Pradesh, comprises a 360 kilo tonnes per annum (KTPA) aluminium smelter, along with a 900 MW captive power plant.
The company, which on a standalone basis has a gross debt level of Rs 23,000 crore, could refinance more loans going ahead. The company has a further debt of Rs 5,000 crore on its Utkal alumina refinery project in Orissa. “If we need to we will certainly refinance more loans. We are certainly not against it,” he said.
Bhattacharya added that the company will only convert its existing rupee loans into rupee loans with an extended tenure and has no plans to dollarise them. “We don’t go for dollar loans. The dolllar is appreciating continously,” he added.
The ramping up of capacity at the Mahaan aluminium and Aditya aliminium projects led to production rising to 242 kt in January-March quarter, up from 217 kt in the previous quarter of last fiscal, Hindalco said.
Hindalco on Thursday reported a 36% fall in standalone net profit to Rs 160 crore for the quarter ended March 31 as higher finance costs and a one- off liability impacted the bottom line. Standalone net sales rose by 10 % to Rs 9,219 crore in the January-March quarter, from Rs 8,360 crore in the same quarter of 2013-14.
More breathing space
* On a consolidated basis, Hindalco’s net profit for FY15 fell to R854 crore from R2,175 crore in FY14 on account of higher interest costs and exceptional items
* Managing director Debnarayan Bhattacharya says the company will only convert existing rupee loans into rupee loans with an extended tenure and has no plans to dollarise them
* The company could refinance more loans going ahead. It has a further debt of R5,000 crore on its Utkal alumina refinery project in Orissa. “If we need to, we will certainly refinance more loans. We are certainly not against it,” Bhattacharya said
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