Photo: Shashi Ashiwal

EYEING ACQUISITIONS: Kumar Mangalam Birla (right), Chairman, Aditya Birla Group, and D. Bhattacharya, Managing Director, addressing the company's AGM in Mumbai on Friday.

MUMBAI: The promoters of Hindalco Industries, the Aditya Birla group, in order to ward off any takeover attempt, will gradually be increasing their stake in the company.

Speaking at the company's 47th annual general meeting here on Friday, Kumar Mangalam Birla, Chairman, Aditya Birla group, said, "the promoters' stake, which is now 25.95 per cent, will gradually be increased through the creeping acquisition route. We are always looking to increase our stake." Mr. Birla said, the capital expenditure plan over the next three years was Rs. 15,000 crore given all the greenfield projects and brownfield expansions planned.

Production target

The company had set itself a production target of 4.60 lakh tonnes of aluminium and 3.60 lakh tonnes of copper and an export target of one lakh tonnes of aluminium and 1.60 lakh tonnes of copper for the current year.

On a possible bifurcation of Hindalco into separate copper and aluminium companies, Mr. Birla said, "internationally, diversified metal companies trade at much higher valuations than single product metal companies. So, there is no chance of separating copper and aluminium." Hindalco was looking at acquisitions of mining or ore companies overseas.

"We are also looking at Africa for the acquisition of captive copper mines," he said.

Debu Bhattacharya, Managing Director, Hindalco, said on the sidelines of the AGM, that in spite of firm prices of copper and aluminium globally, he expected the London Metals Exchange (LME) prices to soften this year. The copper smelter had gone in for a routine 25-day maintenance shutdown a week ago but this had already been built in to the company's plans, he said.

In spite of a sharp increase in fuel oil, coal, pitch and bauxite costs which pressurised margins, for the first quarter of 2006-07, Hindalco reported a 59 per cent jump in net profit at Rs. 601.50 crore (Rs. 379.20 crore) on 94 per cent higher net sales and operating revenues of Rs. 4,273.70 crore (Rs. 2,207.10 crore).

Of the total revenues, aluminium business contributed Rs. 1,654.20 crore. In copper, revenues more than tripled to Rs. 2,621.70 crore driven by rise in copper prices and profits grew to Rs. 97.80 crore (Rs. 52.90 crore).

Printer friendly page  
Send this article to Friends by E-Mail