Hindalco Shares Gain 3.5% After Novelis Posts Higher Q4 Operating Profit

Hindalco Shares Rise 3.5% as Novelis Reports Higher Operating Profit

Aluminium company Hindalco's shares surged 3.5% on May 20, emerging as the top Nifty gainer, following the release of its US-based subsidiary Novelis's fourth-quarter results. The report indicated higher operating profit and a planned restart of the Oswego plant in the coming weeks.

Novelis expects a significant impact on cash flows due to the fires at its Oswego facility. However, the company intends to restart the hot mill earlier than initially planned. Additionally, Novelis anticipates higher medium-term savings from ongoing cost-reduction initiatives. During the quarter, the company reported a net loss of $84 million, while rolled product shipments declined 12% year-on-year.

At 10:15 am on May 20, Hindalco shares were trading 2.8% higher at Rs 1,078.8 apiece. The company's financial performance was affected by various factors, including a $53 million impact from the Oswego fires and an additional $27 million hit from tariffs. However, these pressures were partially offset by $41 million in insurance recoveries related to the Sierre flood incident.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Novelis stated that two separate fires occurred at its Oswego, New York plant during September and November 2025. The company said both incidents were contained to the hot mill area and there were no injuries reported during either event. Commissioning activities at the Oswego plant are progressing, and the hot mill is expected to restart within the next few weeks, ahead of the earlier estimated timeline of end-June 2026.

Novelis also announced that commissioning of the cold mill at its Bay Minette, Alabama greenfield aluminium plant commenced during March 2026. The company stated that the full project commissioning remains on track for the second half of calendar year 2026.

In addition, Novelis reported that it exited FY26 with over $200 million in annualised run-rate cost savings from its global cost efficiency programme. The company now expects total savings of $350 million to $400 million by the end of FY28.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline