Hindalco Limited has posted a 15% growth in topline during the year ended 31st March 2000. The company's bottomline, which has grown by 8%, has benefited largely from the improvement in operating margins. However, the sharp rise in taxation expenditure has moderated the rise in the profits. As a consequence the company's net profit margins have posted a decline of 1%. The company’s performance would have been still better had it not absorbed a one time expenditure of Rs 227.8 m in the current year.
The company’s stock trades at a price to earnings (p/e) ratio of 8.8x, which is at a discount to the overall market p/e. The current p/e is also the lowest as compared to the closing p/es of the company the end of FY97, FY98 and FY99. This is despite the fact that aluminium prices and demand have recovered significantly and the prospects of the sector look much better.
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