Hindalco Industries Limited

Hindalco reported a 6% year-on-year increase in consolidated business segment EBITDA to INR 8,762 crores for Q3 FY26. However, consolidated PAT saw a 45% year-on-year decline to INR 2,049 crores, primarily due to exceptional items^📎 related to the Novelis Oswego plant fires. Excluding these impacts, adjusted PAT would have been INR 4,051 crores, an 8% year-on-year increase. The company maintains a strong balance sheet with a consolidated net debt to EBITDA ratio of 1.73x as of December 2025, well below its target of 2x.

Novelis's adjusted EBITDA reached $436 million, translating to $495 per ton, a 22% year-on-year increase when excluding the $54 million impact from Oswego fires and $34 million from tariffs. The company has increased its cost efficiency initiatives run rate to $150 million, up from an initial target of $75 million, and aims for a $300 million structural cost reduction by FY28 exit. The Bay Minette 600 Kt greenfield rolling and recycling facility is on track for completion this year, with the project cost revised from $4.1 billion to $5 billion, funded partly by a $950 million equity infusion from Hindalco.

Hindalco's India business delivered robust performance, with EBITDA growing 10% year-on-year to INR 5,660 crores and a record PAT of INR 3,581 crores, up 24% year-on-year. The India Upstream Aluminum segment achieved an EBITDA of $1,572 per ton with 45% margins, driven by operational excellence. Downstream Aluminum shipments increased 9% year-on-year to 108 Kt, with EBITDA up 55% to INR 233 crores. The Copper business, however, saw a 23% year-on-year EBITDA decline to INR 595 crores due to lower TC/RCs and concentrate mix, though management expects Q4 EBITDA to be comfortable at INR 600 crores.

Hindalco's India CAPEX target for FY26 is approximately INR 10,000 crores, including the INR 2,000 crores paid for the Bandha Mine, with a similar range projected for FY27 (INR 10,000-12,000 crores). Novelis received a $750 million equity infusion in December 2025, with an additional $200 million planned for the current quarter, to fund the increased Bay Minette project cost and bridge the impact of Oswego fires. The company aims to maintain its consolidated net debt to EBITDA ratio around 2x, despite Novelis's ratio temporarily rising to the 'high 4s'.

Hindalco continues to prioritize ESG, achieving an LTIFR of 0.22 and scoring 89 out of 100 in the S&P Global CSA 2025. The company recycled or reused 82% of total waste generated this quarter, including 126% of Bauxite residue and 126% of Copper slag. Renewable energy capacity reached 418 Megawatts by the end of Q3, with plans to add another 103 Megawatts in the following quarter, targeting 522 Megawatts by the end of FY26. Significant efforts are also underway in water conservation and biodiversity enhancement, including planting 70,000 saplings and a coastal ecological initiative.