Hindalco could feel negative effects of aluminium slide

MUMBAI: Aluminium prices hit 3-year low of at $1,911 per tonne intra-day on the LME on Wednesday. This should have a negative effect on leading domestic non-ferrous players like Hindalco Industries, point out analysts. In the case of Hindalco, its aluminium division alone contributed 39.3 per cent of its standalone net sales of Rs 10, 330.7 crore in the first half of FY 09. Meanwhile, sluggish trend in aluminium prices has led to analysts’ downgrade of Hindalco. Merrill Lynch has sharply downgraded its earnings forecast for the company over the next 18 months. The investment bank expects Hindalco's EPS to decline 39 per cent in FY09 to Rs 9.6 and decline 29 per cent in FY10 to Rs 6.8. However on BSE today, the Hindalco share was up 2 per cent at Rs 57.70. The stock touched a high of Rs 59.10. ---the economic times