Hindalco Industries Limited has informed the Exchange regarding a press release dated August 11, 2025, titled "Novelis Reports First Quarter Fiscal Year 2026 Results".
HINDALCO · price
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Novelis Inc., Hindalco's wholly owned US subsidiary, reported Q1 FY26 (quarter ended June 30, 2025) net sales of $4.7 billion, up 13% year-on-year on higher aluminum prices and 1% growth in rolled product shipments to 963 kilotonnes. However, profitability fell sharply — Adjusted EBITDA declined 17% to $416 million and net income dropped 36% to $96 million, with EBITDA per tonne down 18% to $432. The weakness was driven by elevated scrap prices, unfavorable product mix, and a $28 million net negative tariff impact. Management raised its cost-reduction run-rate target to over $100 million by end of FY26 (up from the earlier $75 million) and reiterated a $300+ million target by end of FY28, taking $83 million of related restructuring charges in the quarter. Net leverage rose to 3.2x (from 2.9x) and the company issued $400 million of tax-exempt bonds to fund the Bay Minette greenfield rolling and recycling plant, which remains on track for 2H CY2026 commissioning.
Near-term consolidated earnings for Hindalco will likely be pressured by Novelis's lower margins, though the aggressive cost-saving plan, strong beverage packaging demand, and progress at Bay Minette provide a clearer path to margin recovery in FY27–28. The rising leverage and elevated capex may limit near-term capital returns from the subsidiary.