Hindalco sets aside $3 bn expansion fund

Hindalco has earmarked $3 billion for more downstream expansion in aluminium business. The company focuses on acquiring assets in developed countries. The funds will be used for acquisition of more downstream assets in the mainstream sector in which the company currently operates.

Media reports suggest that the company has evaluated bids for acquisition of Constellium and Aleris Corp. Constellium makes aircrafts parts and industrial coils, while Aleris makes rolled aluminium sheets. However, the management has declined to comment on these proposed acquisitions. The company had earlier acquired the US company Novelis Inc which prepares aluminium cans and packaging material.

The global commodity prices are on an upstream movement, suggesting positive turnaround for Hindalco and Novelis. The 17 per cent YoY rise in aluminium price bodes well for the company. The company expects positive outlook for the aluminium prices as production cuts in China are expected to take prices higher.

Hindalco Industries Limited is engaged in the production of aluminium and aluminium products, as well as copper and copper products. The company's segments include aluminium, which includes hydrate and alumina, aluminium and aluminium products. Also,the company's aluminium downstream offerings include extrusions, flat-rolled products, foils, wire rods and billets.

The company’s stock is currently trading at Rs 241-mark, almost down by 0.86 per cent as of 14:41 hrs