| |
Jan 6, 2000
Surge in alumina prices benefits domestic companies
Indian aluminium producers are having a field day as international prices of alumina have soared from US$ 150 per tonne to US$ 350 per tonne in 1999. As a consequence, aluminium prices too have registered a sharp rise to US$ 1,614 per tonne. The rise in prices is likely to benefit the Indian alumina exporters most. This has been reported by a leading national daily.
The international alumina prices have been witnessing an uptrend mainly due to the accident at Kaiser Aluminium, a leading manufacturer. This has created a supply gap in the market even as global demand for aluminum continues to register growth. The growth has been mainly due to a global recovery after a slowdown witnessed in 1998.
The Indian companies have been actively tapping the export markets to capitalise on the higher realisations. According to CMIE, exports of aluminium (other than products) grew by 489% (April - September) as against a decline of 78% registered in the corresponding period last year.
In light of the not so strong recovery in the domestic market, the move to tap the export markets will benefit the domestic manufacturers. The higher realisations will more than help in absorbing the rise in energy costs. The aluminium companies will benefit even more once the domestic economy gains further momentum.
The rise in aluminium prices in all probability will cool down once the Kaiser refinery commences production. Then onwards, the prices will be determined by the growth in demand rather than supply shocks. However, problems could arise if once again the global economy were to slow down. Then it would be cost control that would drive margins.
More Views on News
Aug 22, 2017
Hindalco Industries has reported a healthy growth in the topline on the back of Higher volume and realisation for both Aluminium and Copper segments. However, the bottomline declined marginally primarily on the back a provision of Rs 1.04 billion.
Feb 22, 2017
Hindalco Industries has reported a 14.5% YoY increase in the topline while the bottomline came at Rs 3.2 billion.
Dec 21, 2016
SAIL has reported a 21.4% YoY increase in the topline while the bottomline reported a loss of Rs 7.31 billion.
Dec 19, 2016
Tata Steel has reported a 0.1% increase in the topline while the bottomline was in red in 2QFY17.
Nov 30, 2016
Hindalco Industries has reported a 1.1% YoY increase in the topline while the bottomline has accelerated by 255.4% YoY.
More Views on News
Most Popular
Aug 17, 2017
A small-cap Indian company with high-return potential and blue-chip-like stability is set to supplant the Chinese players in this niche segment.
Aug 21, 2017
Most Indians who cannot find jobs, look at becoming self-employed.
Aug 16, 2017
The IT Sector could be in an uptrend till February 2019. Are you prepared to ride the trend?
Aug 16, 2017
Ensure your financial Independence, and pledge to start the journey towards financial freedom today!
Aug 22, 2017
Post demonetisation, a cut in bank savings deposits rates was in the offing.
More
Copyright © Equitymaster Agora Research Private Limited. All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement. LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results. SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407 | |
|
S&P BSE METAL 5-YR ANALYSIS
|
|
Equitymaster requests your view! Post a comment on "Surge in alumina prices benefits domestic companies". Click here!
Comments are moderated by Equitymaster, in accordance with the Terms of Use, and may not appear
on this article until they have been reviewed and deemed appropriate for posting.
In the meantime, you may want to share this article with your friends!