Motilal Oswal: Hindalco Q1 Review - Outlook For Novelis Positive
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Motilal Oswal Report
Hindalco Industries Ltd.’s subsidiary Novelis’ Q1 FY21 operating results were weak (in-line). Ebitda was down 40% YoY to $219 million on like-to-like basis (excluding Aleris Corporation) due to the impact of Covid-19.
Q1 FY21 results include Aleris Corporation acquisition from April 15, 2020. Thus, it is strictly not comparable to previous quarters.
Reported adjusted Ebitda at $253 million was down 31% YoY (versus estimate $264 million including Aleris).
However, it was down 40% YoY to $219 million (excluding Aleris) with Ebitda of $34 million (included in Q1 FY21 results).
Volumes declined 6% YoY to 781 kilo tonne (versus estimate 755 kt ) on a reported basis and by approximately 15% YoY to 706 kt on a like-to-like basis (excluding 75 kt sales in the quarter from Aleris).
Volumes were largely impacted by approximately 50% YoY decline in automotive shipments.
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