Hindalco to invest $3 billion in five years
Premium- In Novelis, the capex will be invested mainly in auto-finishing line expansions in the US and China and rolling and recycling capacity expansions in Brazil
MUMBAI : Hindalco has earmarked approximately $2.5 to $3 billion of growth capex on a consolidated basis, over the next five years, Kumar Mangalam Birla, the chairman of Hindalco Industries Limited, told the shareholders at the company's 62nd annual general meeting held on August 23.
In Novelis, the capex will be invested mainly in auto-finishing line expansions in the US and China and rolling and recycling capacity expansions in Brazil.
"In India, we are on-track to implement organic growth projects entailing a capital outlay of over $1billion towards Utkal alumina expansion, various Aluminium and Copper downstream expansions, and specialty alumina projects. These investments will advance our strategy of building a more predictable and resilient business model," added Birla.
Hindalco has committed to achieving net carbon neutrality by 2050. Net neutrality means for every tonne of carbon dioxide the company puts into the atmosphere, it takes out one tonne from it, thereby achieving a balance.
"Our pursuits so far have led to a 17% reduction in specific energy consumption in Aluminium production against our target of 25% reduction by 2025," said Birla.
Bauxite residue disposal, which is a global concern, has led the company to identify a circular solution where the residue is used as an input in the cement industry. In the year gone by, Hindalco has achieved 100% bauxite residue utilization, becoming the first aluminium company in the world to do so.
In collaboration with other industries, Hindalco continues to strengthen waste utilization and is confident of achieving our target of zero waste to landfill by 2030.
"Your company’s focus on increasing recycled content in manufacturing downstream products is stronger than ever, with Hindalco subsidiary Novelis emerging as a leader in recycling with 61% recycled inputs for all our products," said Birla.
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Hindalco has brought down the consolidated net debt-to-ebitda to 2.59 times at the end of the financial year from a peak of 3.83 times at the end of June 2020, after closing the acquisition of Aleris.
Birla said the acquisition is a key step towards the diversification of the company’s downstream portfolio into certain premium market segments, particularly aerospace.
"Post the acquisition, this year proved to be remarkable for Novelis (+Aleris) as it delivered its best performance, clocking the highest-ever-- shipments of 3613 Kt; adjusted EBITDA of $1,714 million at Novelis and adjusted EBITDA/tonne of $474 at Novelis," said Birla.
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