Hindalco Industries’ first-quarter net gain increased 11 per cent to Rs 534 crore, in contrast to the similar period last year; the gains are linked to the higher metal prices.

Driven by higher volumes, better product/geographic mix and improved realization, net sales advanced 33 per cent to Rs 5,178 crore. Out of this, the aluminium business contributed Rs 1,867 crore, while the copper business contributed Rs 3,314 crore.

Debu Bhattacharya, MD of Hindalco said that, “The growth in net sales was driven by higher volumes, better product/geographic mix and improved realization.” According to the company, its low cost advantage, arising from integration and captive coal for own power generation for Hirakud smelter, cushioned the adverse impact of spiraling cost escalation of crude and crude derivatives as well as purchased coal for Renukoot and plummeting copper TcRc (treatment charges and refining charges).

After the financial closures of Utkal Alumina Refinery, it is the turn of Mahan Aluminum, as both projects are linked and are scheduled to be completed by September 2011. Sunirmal Talukdar, chief financial officer of the company said that, “We have started the talks with the bankers for the debt syndication of Mahan Aluminum, but the mandate has not been given yet.”

Hindalco's gain pre tax during the first quarter was also up by 12% to Rs 673 crore from Rs 600 crore last year. Of the net revenues of Rs 5,178 crore, aluminum business supplied Rs 1,867 crore with an EBIT of Rs 552 crore. Bhattacharya said that, “Aluminum sales were higher on the back of higher volume, better mix, along with better LME compared to Q1FY10. These benefits were eroded partly by the appreciating rupee and higher energy cost.”