Hindalco’s ongoing expansion will involve $10 billion capital expenditure, says KM Birla
Hindalco Industries’ expansion plans include an investment of USD 10 billion, the company’s chairman KM Birla said today at the company’s annual general meeting.
In addition to the continued expansion at Novelis, this investment also includes plans for expansions of aluminum and copper smelters.
Birla said in his speech: “Our expansions in India and Novelis will involve investments of $10 billion for ongoing projects and projects anticipated in the near term.” He added: “These include the expansions of the aluminium and copper smelter, the Aditya FRP plant, the new alumina refinery at Rayagada and the Bay Minnette expansion at Novelis.”
Elaborating on each of these projects, he noted: “Hindalco also has plans to expand its copper smelting capacity and is exploring the possibility of setting up a brownfield facility in Gujarat to meet the country’s growing need for this crucial metal.”
Commenting on the rationale for expanding into aluminium and copper, he said: “Hindalco is committed to pioneering India’s green transition while enabling the country’s growth ambitions. This would mean taking big, bold steps across our operations, from upstream to downstream.”
Birla noted that Hindalco is setting up a greenfield alumina refinery at Rayagada, Odisha. The first phase of 850,000 tonnes is expected to come on stream in FY27. He also highlighted that Hindalco is evaluating a brownfield expansion of nearly 200,000 tonnes at its Aditya Aluminium smelter in Odisha.
For the Bay Minnette project, he added, “we have already secured long-term contracts for all new beverage packaging capacity at this facility, which is expected to come on stream in the second half of calendar year 2026.”
Birla expects India’s aluminium consumption, which stood at 5 million tonnes in FY24, to double to around 10 million tonnes in the coming decade. “We expect copper consumption to grow by 10 per cent in the coming years,” he added.
On the company’s capital allocation strategy, Birla noted, “Hindalco continues to execute its well-structured capital allocation plan, focusing free cash flow on organic growth and dividend distribution. Despite repaying Rs 5,195 crore of debt in the Hindalco India business during the year, Hindalco maintained a strong balance sheet and solid liquidity. This positions us well to realise our future organic growth plans through prudent capital allocation.”
First publication: Aug 22, 2024 | 5:51 PM IST