Hindalco Net Falls 37% to 2,456 cr on Derivatives Hit

Hindalco Industries, the country's largest aluminium producer, registered a 37% fall in consolidated full-year net profit because of derivative losses and higher capital spending and debt costs.  Group net profit for the year ended March fell to . 2,456 crore, while revenues, including that of subsidiary Novelis, rose 19% to . 72,078 crore on strong volumes, an improved product mix and firm aluminium and copper prices.  "We are working on a strategy that aims to create a complementary business model. As we grow our upstream business by raising primary metal capacity, we would be exposed to volatility in LME prices. However, growth in our value-added products business will create a natural hedge against any market volatility," Hindalco managing director D Bhattacharya said.  Hindalco scrip fell 2.3% to . 193.05 in Mumbai trading. The shares have fallen 22% this year, compared to an 11% drop in stock market benchmark Sensex.  Hindalco's earning before depreciation, interest and tax, or EBITDA, declined to . 8,433 crore, from . 10,069 crore a year ago.  Its net profit of . 3,925 crore last fiscal had included a derivative gain of . 2,736 crore, while it recorded a loss of Rs 291 crore on the same account in FY11. During the year, financing charges rose 66% to . 1,839 crore, against . 1,104 crore.