Satish Pai, MD of Hindalco on Thursday said that they are on track to achieve their targeted reduction of Rs 900 crore.
"On the domestic side, we are doing much better than the run rate required to reach Rs 900 crore. With the COVID-19 impact and travel going down and people working more from home, we have seen quite a lot of reduction in the corporate cost as well. So, from a cost reduction point of view, in India we are well on track to achieve our targeted reduction,” he said in an interview to CNBC-TV18.
On volumes, he said that Q3FY21 volume were hit by the smelter plant shutdown. However, he expects Q4 copper volumes to ramp-up versus Q3. He added that post the copper shutdown in Q1FY22, they do not expect any disruption for the next two years.
On Novelis, Pai said they are confident of maintaining EBITDA of $475-500/tonne. "The guidance for Novelis, we have been very consistent now for two quarters giving that $475-500. This quarter we hit $537. So we are quite confident to maintain the $500/tonne. With the scrap spreads being good, Novelis being flat out, auto, cans, specialty’s doing well, we are quite confident to keep the $500/tonne EBITDA on the Novelis side,” he said.
He said that $120 million of synergy benefits will be achieved at the end of the next fiscal at Novelis.
On Aleris, he said that it will take two years to reach the targeted $370 million. Currently, they have achieved $54 million synergies in the last 9 months, he added.
Pai said that the capex plan will be focused on growth and not on acquisitions. He said that they intend to continue to deleverage balancesheet hereon.
He added that the consolidated net debt to EBITDA will come down to 3x by March 2021. He said that they will be repaying the $1.1 billion bridge loan availed for Aleris by March 2021.
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