Hindalco plans Rs 16k cr capex over next 2 years

Mumbai: Hindalco Industries, an integrated producer of aluminum and a leading copper manufacturer, has drawn up a Rs 16,000-crore capex plan for the next two years, a top company official said. "We have drawn up a Rs 5,623 crore capital expenditure plan, which includes Rs 4,560 crore for greenfield projects and Rs 1,063 crore for other projects in FY 10," Hindalco's chairman Kumar Mangalam Birla said. "We plan to invest Rs 10,458 crore in FY11, of which Rs 8,406 crore will go into greenfield projects and Rs 2,052 crore into other projects," Birla said. The company plans to increase its production in the current year. "Unlike several players across the world who are uncompetitive and not able to operate at profit at current levels of LME and reducing capacities, we are actually working to increase capacity," Birla said. Birla pointed out that the total production of alumina is expected to touch 6 million tonne and aluminium to 1.5 mt by FY13, which is a substantial jump from the current level of production. The copper production is expected to touch 3,50,000 tonne this year and company sees strong growth for copper in the coming years. Birla assured the shareholders that the management was working hard to increase the profitability of the company. Its greenfield projects — Utkal Alumina and Aditya Aluminium in Orissa, Mahan Aluminium in Madhya Pradesh and Jharkhand Aluminium in Jharkhand, will go on-stream between 2011 and 2013. With this, the company's smelting capacity will increase from 0.5 mt to 1.7 mt with three new projects of 360 ktpa each. The company's refining capacity will increase from 1.7 mt at present to 6.15-mt. The company has acquired part of the land and is awaiting clearance from the environment ministry for its Aditya Aluminium project. The company hopes to get environment clearance by October, Birla said. Hindalco's Atlanta-based subsidiary, Novelis, is expected to make $1 billion of operational profit from FY13. "We expect $1 billion (Rs 5,000 crore) of earnings before interest, taxes, depreciation and amortization (EBITDA) for Novelis in FY13. We have initiated steps to bring down costs to the extent of $140 million per year," Birla said.