Hindalco Snapshot

Hindalco Industries Limited
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Financial Snapshot
Operating Performance
Fast Facts
Headquarters Address
Aditya Birla Centre, Mumbai, 400030,India
Telephone
+ 91 22 66525000
Fax
+ 91 22 66525841
Website
www.hindalco.comindex.htm
Ticker Symbol, Stock Exchange
500440, Bombay Stock

ExchangeHINDALCO, National Stock
Exchange of India
Number of Employees
20,238
Fiscal Year End
March
Revenue (in US$ million)
15,190
The company reported revenue of US$15,190 million

during the fiscal year 2013 (2013). The company's
revenue grew at a CAGR of 2.72% during 2009
2013, with an annual decline of 0.49% over 2012. In
2013, the company recorded an operating margin of
4.81%, as against 5.32% in 2012.
Revenue and Margins
SWOT Analysis
Strengths
Weaknesses
Business Diversity
Low Debt to Equity Ratio
Dominant Market Position
Trade Accounts Receivable
Efficient Liquidity Position
Opportunities
Threats
Business Expansion Activities
Fluctuations in Commodity Prices
Growing Demand for Aluminium
Project Execution Risk
Positive Outlook for Copper Market
Structural Deficit
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Hindalco Industries Limited - SWOT Profile
Page 1

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TABLE OF CONTENTS
Hindalco Industries Limited - Business Analysis ............................................................................... 5

1.1
Hindalco Industries Limited - Company Overview ............................................................................................. 5
1.2
Hindalco Industries Limited - Business Description........................................................................................... 5
1.3
Hindalco Industries Limited - Major Products and Services............................................................................... 7
Hindalco Industries Limited - Analysis of Key Performance Indicators ............................................. 8

2.1
Hindalco Industries Limited - Five Year Snapshot: Overview of Financial and Operational Performance
Indicators ..................................................................................................................................................................... 8
2.2
Hindalco Industries Limited - Key Financial Performance Indicators ............................................................... 11
2.2.1
Hindalco Industries Limited - Revenue and Operating Profit ....................................................................... 11
2.2.2
Hindalco Industries Limited - Asset and Liabilities ...................................................................................... 12
2.2.3
Hindalco Industries Limited - Net Debt vs. Gearing Ratio ........................................................................... 13
2.2.4
Hindalco Industries Limited - Operational Efficiency ................................................................................... 14
2.2.5
Hindalco Industries Limited - Solvency....................................................................................................... 15
2.3
Hindalco Industries Limited - Key Competitors ............................................................................................... 16
Hindalco Industries Limited - Recent Developments ....................................................................... 17
Hindalco Industries Limited - SWOT Analysis .................................................................................. 18

4.1
Hindalco Industries Limited - SWOT Analysis - Overview ............................................................................... 18
4.2
Hindalco Industries Limited - Strengths .......................................................................................................... 18
4.3
Hindalco Industries Limited - Weaknesses ..................................................................................................... 19
4.4
Hindalco Industries Limited - Opportunities .................................................................................................... 19
4.5
Hindalco Industries Limited - Threats ............................................................................................................. 20
Hindalco Industries Limited - Company Statement .......................................................................... 21
Hindalco Industries Limited - History ............................................................................................... 23
Hindalco Industries Limited - Key Employees .................................................................................. 24
Hindalco Industries Limited - Key Employee Biographies ............................................................... 26
Hindalco Industries Limited - Locations and Subsidiaries ............................................................... 27

9.1
Hindalco Industries Limited - Head Office....................................................................................................... 27
9.2
Hindalco Industries Limited - Other Locations and Subsidiaries ...................................................................... 27
10
Appendix ........................................................................................................................................... 29
10.1
Methodology .................................................................................................................................................. 29
10.2
Ratio Definitions ............................................................................................................................................ 29
10.3
Disclaimer ..................................................................................................................................................... 33
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TABLE OF CONTENTS
Hindalco Industries Limited - Business Analysis ............................................................................... 5

1.1
Hindalco Industries Limited - Company Overview ............................................................................................. 5
1.2
Hindalco Industries Limited - Business Description........................................................................................... 5
1.3
Hindalco Industries Limited - Major Products and Services............................................................................... 7
Hindalco Industries Limited - Analysis of Key Performance Indicators ............................................. 8

2.1
Hindalco Industries Limited - Five Year Snapshot: Overview of Financial and Operational Performance
Indicators ..................................................................................................................................................................... 8
2.2
Hindalco Industries Limited - Key Financial Performance Indicators ............................................................... 11
2.2.1
Hindalco Industries Limited - Revenue and Operating Profit ....................................................................... 11
2.2.2
Hindalco Industries Limited - Asset and Liabilities ...................................................................................... 12
2.2.3
Hindalco Industries Limited - Net Debt vs. Gearing Ratio ........................................................................... 13
2.2.4
Hindalco Industries Limited - Operational Efficiency ................................................................................... 14
2.2.5
Hindalco Industries Limited - Solvency....................................................................................................... 15
2.3
Hindalco Industries Limited - Key Competitors ............................................................................................... 16
Hindalco Industries Limited - Recent Developments ....................................................................... 17
Hindalco Industries Limited - SWOT Analysis .................................................................................. 18

4.1
Hindalco Industries Limited - SWOT Analysis - Overview ............................................................................... 18
4.2
Hindalco Industries Limited - Strengths .......................................................................................................... 18
4.3
Hindalco Industries Limited - Weaknesses ..................................................................................................... 19
4.4
Hindalco Industries Limited - Opportunities .................................................................................................... 19
4.5
Hindalco Industries Limited - Threats ............................................................................................................. 20
Hindalco Industries Limited - Company Statement .......................................................................... 21
Hindalco Industries Limited - History ............................................................................................... 23
Hindalco Industries Limited - Key Employees .................................................................................. 24
Hindalco Industries Limited - Key Employee Biographies ............................................................... 26
Hindalco Industries Limited - Locations and Subsidiaries ............................................................... 27

9.1
Hindalco Industries Limited - Head Office....................................................................................................... 27
9.2
Hindalco Industries Limited - Other Locations and Subsidiaries ...................................................................... 27
10
Appendix ........................................................................................................................................... 29
10.1
Methodology .................................................................................................................................................. 29
10.2
Ratio Definitions ............................................................................................................................................ 29
10.3
Disclaimer ..................................................................................................................................................... 33
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List of Tables
Table 1: Hindalco Industries Limited - Major Products and Services ................................................................................. 7
Table 2: Hindalco Industries Limited - Key Ratios - Annual .............................................................................................. 8
Table 3: Hindalco Industries Limited - Key Capital Market Indicators .............................................................................. 10
Table 4: Hindalco Industries Limited - History ................................................................................................................ 23
Table 5: Hindalco Industries Limited - Key Employees ................................................................................................... 24
Table 6: Hindalco Industries Limited - Key Employee Biographies ................................................................................. 26
Table 7: Hindalco Industries Limited - Subsidiaries ........................................................................................................ 27
Table 8: Hindalco Industries Limited - Locations ............................................................................................................ 28
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List of Figures
Figure 1: Hindalco Industries Limited - Revenue and Operating Profit ............................................................................ 11
Figure 2: Hindalco Industries Limited - Financial Position............................................................................................... 12
Figure 3: Hindalco Industries Limited - Net Debt vs. Gearing Ratio ................................................................................ 13
Figure 4: Hindalco Industries Limited - Operational Efficiency ........................................................................................ 14
Figure 5: Hindalco Industries Limited - Solvency ............................................................................................................ 15
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1 Hindalco Industries Limited - Business Analysis

1.1
Hindalco Industries Limited - Company Overview
Hindalco Industries Limited (Hindalco) is a aluminium and copper company. The company is a part of Aditya Birla Group.
It operates in two business segments, namely, Aluminium and Copper. The aluminium operation also includes mining of
bauxite to produce not only primary aluminium but also value added downstream products. Hindalco provides a wide
range of aluminum products including standard and specialty grade aluminas & hydrates, billets, wire rods, extrusions,
aluminium ingots, flat rolled products, foil and alloy wheels and broad spectrum of copper products including cathodes,
continuous cast copper rods along with other by-products, including gold, silver and DAP fertilisers. It has its operations in
Europe, Canada, Asia, Australia and the US. Hindalco is headquartered in Mumbai, India.
The company follows a integrated business model in case of its aluminium business. The upstream strategy of its
aluminium products is to focus on the continuing existing low cost operations and progressing on new greenfield projects.
This will enable the company to reduce the cost competitiveness through lowest production costs. The company strategy
for its downstream product is to leverage its strength further. Recently, it has acquired Novelis which has provided a well
diversified geographical market base to the company.
1.2
Hindalco Industries Limited - Business Description
Hindalco Industries Limited (Hindalco) operates as the metals flagship company of the Aditya Birla Group. It produces
broad range of aluminum and copper products as well as exports these aluminium products. After the acquisition of
Novelis Inc., the company placed as the top five aluminium majors across the world and the largest vertically integrated
aluminium company in India.
The companys Aluminium segment is engaged in the production and distribution of hydrate and alumina, aluminum and
aluminum products. The aluminium units of the segment encompass the entire gamut of operations, from bauxite mining,
alumina refining, aluminium smelting to downstream rolling, extrusions and recycling in India. The Aluminium segment
operates across India. Hindlaco operates aluminium units across the world, which consists of the entire gamut of
operations, from bauxite mining, alumina refining and aluminium smelting to downstream rolling, extrusions, foils, along
with captive power plants and coal mines. The major aluminium products of Hindalco are standard and specialty grade
aluminas and hydrates, aluminium ingots, billets, wire rods, flat rolled products, extrusions and foil. The company's
integrated facility at Renukoot comprises an alumina refinery and an aluminium smelter, along with facilities for the
production of semi-fabricated products such as redraw rods, flat rolled products and extrusions. The plant gas has support
of a co-generation power unit and a 742 MW captive power plant at Renusagar, which will help to ensure the continuous
supply of power for smelter and other operations. The Aluminium segment's facilities are an aluminium smelter at Hirakud
(Odisha) with a captive power plant and coal mine, alumina refineries at Muri (Jharkhand), and Belgaum (Karnataka), and
rolling mills at Belur (West Bengal), and Taloja, Mouda (Maharashtra), foil rolling at Kalwa (Maharashtra) and Silvassa
(Union Territory of Dadra and Nagar Haveli) and an extrusions plant at Alupuram (Kerala).
Being a leading player in the extrusions industry in India, Hindalco offers a range of alloys including hard alloys and some
special alloys for the defense and space sectors. It has a extrusions capacity of 31,000 tpa. Hindalco is an India's largest
manufacturer of the entire range of flat rolled products. The Aluminium segment also offers services through its
subsidiary, Novelis, an aluminium rolled products producer based on shipment volume, which is the leading producer of
aluminium rolled products in Europe, South America and Asia, and the second leading producer in North America. Novelis
is engaged in recycling used aluminium beverage cane. The company serves to industries such as automotive,
transportation, packaging, construction and printing. For the fiscal year ended March, 2012, the Aluminium segment
generated INR 90411.7m, reflecting an increase of 13.5% over the revenue 2011. In 2012, the Aluminium segment
accounted for 33.97% of the companys total revenue.
The Copper segment of the company carries out operations of a copper unit, Birla Copper, is the largest single-location
copper smelter in the world, which is located at Dahej in Gujarat, India with a capacity of 500,000 tpa. Birla Copper unit
provides copper cathodes, continuous cast copper rods and other by-products such as gold, silver and DAP fertilizers.
Birla Copper unit also produces precious metals, fertilizers and sulphuric and phosphoric acid. The copper unit has
captive power plants that can provide continuous power generation and a captive jetty to facilitate logistics and
transportation. The company's copper cathode products are distributed under the brand name of Birla Copper and Birla
Copper II. For the fiscal year ended March, 2012, the Copper segment generated INR 175745.6m, reflecting an increase
of 10.5% over the revenue of 2011. In 2012, the Copper segment accounted for 66.03% of the companys total revenue.
Under research and development activities, Hindalco operates two R&D centers at Belgaum and Taloja, both recognized
by the Department of Scientific & Industrial Research (DSIR), the Government of India. The Belgaum R&D center carries
out research in the field of bauxite, Bayer process and alumina. The Taloja R&D center specially focuses on the field of oil
and lube and aluminium related metallurgical services. Hindalco also offers industry leading technology and operating
expertise to a large base of customers across the world. For the fiscal year ended 2012, the research and development
expenditure was INR 71.3m.
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Geographically, the company operates through two regions namely, India and Rest of World. For the fiscal year ended
2012, India accounted for 70.26% of the company's total revenue followed by Rest of World with 29.74%.
The subsidiaries of the company are Bihar Caustic and Chemicals Limited, Dahej Harbour and Infrastructure Limited, East
Coast Bauxite Mining Company Private Limited, Hindalco - Almex Aerospace Limited, Indal Exports Limited, Lucknow
Finance Company, Aditya Birla Minerals Limited, AV Minerals (Netherlands) B.V. and Birla Resources Pty Limited.
Hindalco owns 51% in Aditya Birla Minerals Ltd., (ABML), which wholly-owned Birla Nifty Pty Limited and Birla Mt. Gordon
Pty Limited located in Western Australia and Queensland, respectively. Hindalco acquired two Australian copper mines,
namely, Nifty and Mt. Gordon. Its Nifty copper mine encompasses an underground mine, heap leach pads and a solvent
extraction and electrowinning (SXEW) processing plant, which involves in producing copper cathode. The Mt. Gordon
copper operation includes an underground mine and a copper concentrate plant. Till date, the operation unit produced
copper cathode by using the ferric leach process. Hindalco-Almex Aerospace Limited (HAAL) is established through a
joint venture between Hindalco Industries Limited (70% interest) and Almex USA Incorporated (30% interest). HAAL
manufactures high-strength aluminium alloys that useful in the aerospace, sporting goods and surface transport
industries.
Hindalco planned an Aditya Aluminium project of a 359 ktpa, Aluminium smelter along with a 900 MW captive power plant
in Odisha, which will be completed in 2013. The company also planned out a Aditya Refinery Project of 1.5 million tonnes
per annum of alumina Refinery along with a 90 MW cogen plant in Odisha, which will be operational in 2014.
In September 2012, the company subsidiary Novelis, signed a multi year agreement with Jaguar Land Rover to supply
automotive sheet products. In April, Novelis has signed an agreement with the Changzhou National Hi-Tech district to
build the companys first automotive sheet manufacturing facility in China.
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1.3
Hindalco Industries Limited - Major Products and Services
Hindalco Industries Limited (Hindalco) is an India-based company, engaged in the production of aluminum and copper.
The companys key products and brands include the following:
Table 1: Hindalco Industries Limited - Major Products and Services
Products:
Alumina
Primary Metal
Wire Rods
Value Added Products (VAP)
Flat Rolled products
Extrusions
Foils
Wheels
Copper
Primary Aluminium Ingots
Brands:
Birla Copper
Birla Copper II
Source: World Market Intelligence
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2 Hindalco Industries Limited - Analysis of Key Performance

Indicators
2.1
Hindalco Industries Limited - Five Year Snapshot: Overview of Financial and Operational
Performance Indicators
The company reported revenue of US$15,190 million during the fiscal year 2013 (2013). The company's revenue grew at
a CAGR of 2.72% during 20092013, with an annual decline of 0.49% over 2012. During 2013, operating margin of the
company was 4.81% in comparison with operating margin of 5.32% in 2012. In 2013, the company recorded a net profit
margin of 3.73% compared to a net profit margin of 4.16% in 2012.
Table 2: Hindalco Industries Limited - Key Ratios - Annual
Key Ratios
Unit/Currency
2013
2012
2011
2010
2009
Equity Ratios
EPS (Earnings per Share)
INR
15.81
17.74
12.83
22.16
3.21
Dividend per Share
INR
1.40
1.55
1.50
1.35
1.35
Absolute
11.29
11.45
8.55
16.42
2.38
INR
184.53
166.68
151.61
112.60
92.68
Gross Margin
28.98
27.25
28.41
30.64
25.55
Operating Margin
4.81
5.32
5.29
10.13
-0.91
Net Profit Margin
3.73
4.16
3.38
6.43
0.73
Profit Markup
41.53
37.96
40.07
44.51
34.81
PBT Margin (Profit Before Tax)
4.81
5.32
5.29
10.13
-0.91
Return on Equity
8.57
10.64
8.46
18.22
3.07
Return on Capital Employed
4.01
5.36
5.90
11.50
-1.17
Return on Assets
2.51
3.35
2.89
5.47
0.70
Return on Fixed Assets
4.80
6.35
7.33
12.73
-1.24
Return on Working Capital
24.50
34.17
30.38
119.51
-20.09
Sales Growth
-0.78
11.94
18.93
-7.97
9.91
Operating Income Growth
-10.04
13.06
-37.82
EBITDA Growth
-3.71
6.28
-26.61
269.64
-55.40
Net Income Growth
-10.89
38.29
-37.42
711.23
-77.94
EPS Growth
-14.46
46.08
-42.04
575.66
-80.65
Working Capital Growth
25.48
0.51
144.62
71.78
-29.23
Operating Costs (% of Sales)
95.19
94.68
94.71
89.87
100.91
Administration Costs (% of Sales)
15.25
13.49
8.30
8.32
8.03
Current Ratio
Absolute
1.69
1.63
1.64
1.29
1.17
Quick Ratio
Absolute
1.07
0.97
0.94
0.66
0.68
Cash Ratio
Absolute
0.46
0.40
0.41
0.12
0.13
Absolute
1.61
1.29
1.02
1.20
1.80
Dividend Cover
Book Value per Share
Profitability Ratios
Growth Ratios
-120.48
Cost Ratios
Liquidity Ratios
Leverage Ratios
Debt to Equity Ratio
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Table 2: Hindalco Industries Limited - Key Ratios - Annual

Key Ratios
Unit/Currency
2013
2012
2011
2010
2009
Net Debt to Equity
Absolute
1.67
1.37
1.09
1.26
1.87
Debt to Capital Ratio
Absolute
0.58
0.51
0.45
0.48
0.55
Asset Turnover
Absolute
0.67
0.80
0.86
0.85
0.97
Fixed Asset Turnover
Absolute
1.47
1.92
2.55
2.27
2.53
Inventory Turnover
Absolute
3.95
4.42
3.75
3.73
5.74
Current Asset Turnover
Absolute
2.08
2.47
2.24
2.63
3.29
Capital Employed Turnover
Absolute
2.30
2.56
2.51
2.83
4.23
Working Capital Turnover
Absolute
5.09
6.42
5.75
11.80
22.14
Efficiency Ratios
Revenue per Employee
INR
39,624,864.00
Net Income per Employee
INR
1,495,647.00
Capex to Sales
14.62
15.33
10.88
7.02
4.01
R&D to Sales
0.34
0.28
0.26
0.31
0.29
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Table 3: Hindalco Industries Limited - Key Capital Market Indicators

Key Ratios
12-Jun-2014
P/E (Price/Earnings) Ratio
10.71
Dividend Yield
0.01
Note: Above ratios are based on share price as of 12-Jun-2014. The above ratios are absolute numbers.
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2.2
2.2.1
Hindalco Industries Limited - Key Financial Performance Indicators

Hindalco Industries Limited - Revenue and Operating Profit
The consolidated group revenue of the company for 2013 stood at US$15,190 million, which corresponds to a decline of
0.49% over the previous year. The operating margin of the company was 4.81% in 2013, a decrease of 51.00 basis
points over the previous year.
Figure 1: Hindalco Industries Limited - Revenue and Operating Profit
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2.2.2
Hindalco Industries Limited - Asset and Liabilities
The company's assets grew 18.92% over the previous year to US$22,557 million in 2013. The company's liabilities grew
22.69% over the previous year to US$15,948 million in 2013. The company's asset to liability ratio reduced from 1.46 in
2012 to 1.41 in 2013.
Figure 2: Hindalco Industries Limited - Financial Position
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2.2.3
Hindalco Industries Limited - Net Debt vs. Gearing Ratio
The company recorded higher net debt of US$10,653 million at the end of fiscal year 2013 when compared to the
previous year's net debt of US$7,677 million. The company's gearing ratio for the year 2013 was 1.41, which was higher
when compared to the previous year's gearing ratio of 1.16. The gearing ratio remained higher in 2013 due to higher debt
funding activities over equity.
Figure 3: Hindalco Industries Limited - Net Debt vs. Gearing Ratio
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2.2.4
Hindalco Industries Limited - Operational Efficiency
The company's working capital turnover for 2013 declined to 5.09, from the previous year's working capital turnover of
6.42. In 2013, the company's asset turnover declined to 0.67 from the previous year's asset turnover of 0.80.
Figure 4: Hindalco Industries Limited - Operational Efficiency
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2.2.5
Hindalco Industries Limited - Solvency
In 2013, the company's current ratio increased to 1.69 from the previous year's current ratio of 1.63. The companys quick
ratio increased to 1.07 in 2013 from the previous year's quick ratio of 0.97. In 2013, the companys debt ratio increased to
0.47 from the previous year's debt ratio of 0.40.
Figure 5: Hindalco Industries Limited - Solvency
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2.3
Hindalco Industries Limited - Key Competitors
The following companies are the major competitors of Hindalco Industries Limited:
Aleris International, Inc.
Companhia Brasileira de Aluminio
Furukawa-Sky Aluminum Corp. (Ticker: 5741)
Sumitomo Light Metal Industries, Ltd. (Ticker: 5738)
Wise Metal Group LLC Alcoa
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3 Hindalco Industries Limited - Recent Developments

Hindalco Announces Standalone And Consolidated Audited Results For Year Ended 31 March 2014
Hindalco Industries Limited, the flagship company of the Aditya Birla Group, announced its standalone as well as consolidated audited
financial results for the year ended 31 March 2014.
Published Date : 5/29/2014 12:00:00 AM
L&T wins metallurgical, material handling & water sector projects
India based Larsen & Toubros (L&T) has secured orders aggregating to INR11.26 billion ($251 million) from M/s. Sterlite Industries
India Limited, M/s. Hindalco Industries Limited, M/s. TATA Steel Limited, M/s. Delhi Jal Board and M/s. Uttar Pradesh Jal Nig am
Limited.
Published Date : 3/30/2010 12:00:00 AM
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4 Hindalco Industries Limited - SWOT Analysis

4.1
Hindalco Industries Limited - SWOT Analysis - Overview
Hindalco Industries Limited (Hindalco) is one of the leading companies in aluminium and copper industries in India. The
company operates in two business segments, namely, Aluminium and Copper. The company retains strong foothold in the
market with efficient business diversity coupled with strong liquidity/cash flow. However, the companys increasing trade
accounts receivable along with low debt to equity is a cause of concern for the company to look upon. Nevertheless, it can
utilize the opportunity of growing aluminium and copper market along with strategic business expansion activities.
However, the company faces threat from the volatility of commodity prices and project execution risks.
4.2
Hindalco Industries Limited - Strengths
Strengths - Efficient Liquidity Position

During 2011, the company generated free cash flow of INR8,777.20m, maintaining a good liquidity along with minimal
project financing during the year. The company generated this free cash flow after maintaining capital expenditure,
interest, and tax. Additionally, its current ratio was 1.29 at the end of fiscal year 2011.A higher current ratio indicat es that
the company is in a strong financial position and is more capable of meeting its short term obligations than other
companies in the sector. Additionally, its quick ratio reflected at 0.64 along with cash ratio of 0.12 during the fiscal 2011 .
Further, the company's current asset was INR279,848.4m in 2011, compared to current liabilities of INR216,840.3m. Such
an efficient liquidity position of the company indicates its strong financial position and stability.
Strengths - Dominant Market Position
The company operates and maintains business as one of the largest producers of primary aluminium in Asia and also one
of the world's largest aluminium rolling companies. The company retains business operation under two segments, namely,
Aluminium and Copper. Hindalco is placed among the top five aluminium manufacturers across the world and as the
largest vertically integrated aluminium company in India. The company has obtained international certifications for its
business activities such as ISO-9001:2000 for quality management system, ISO-14001:2004 for environmental
management system and OHSAS-18001:2007 for occupational health and safety management systems. Presently, the
company has spread operations through 51 units including aluminium refinery, extrusion plant, foil plant, rolled product
plant, smelters, coating, converting and technology center. It renders wide product portfolio and maintains global footprint
across 13 countries. For the fiscal year 2011, the company recorded a consolidated turnover of $15.85 billion and is
placed in the Fortune 500 league. Such a strong position of the company enables it to strengthen its market position and
financial growth prospect.
Strengths - Business Diversity
Wider reach in terms of geography would mean reaping more benefits, eventually improving the profit margins, attaining
economies of scale and recognition on a worldwide basis. Hindalco caters to the requirements of wide customer base
through diverse operations including alumina refinery, extrusion plant, aluminium foil plant, aluminium rolled product plant,
aluminium smelter, cold rolled, converting, integrated aluminium and copper complex, bauxite, coal & copper mines, as
well as research & development activities. The company has business operations spread across 13 countries, with units
located at North America, Europe, Asia, South America and Australasia. For the fiscal year 2011, the company registered
23% revenue generated from India and the remaining 77% from rest of the world. Diversity endows the company with a
wider customer base, stronger brand presence and growth across emerging markets. In addition, it enables the company
to mitigate market volatility and attain economic stability.
The company maintains a strong product portfolio covering standard and specialty grade aluminas and hydrates,
aluminium ingots, billets, wire rods, flat rolled products, extrusions and foil. Thus, diverse business operations enable the
company to serve diverse customers base supporting the company to mitigate market volatility in any specific market.
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4.3
Hindalco Industries Limited - Weaknesses
Weaknesses - Low Debt to Equity Ratio

Hindalcos low debt to equity ratio indicates that it is exposing itself to a large amount of equity. In fiscal year 2011,
Hindalco recorded debt-equity ratio of 101.51%, compared to 119.66% in 2010. The company recorded total equity of
INR290,232.90m in 2011, compared to INR215,446.40m in 2010. The total debt stood at INR294,603.60m in 2011, as
against INR257,803.10m in 2010. This indicates that the company is heavily dependent on equity for its finance.
Financing a project with debt rather than equity will normally increase shareholder returns, because of the low cost of debt
(interest - tax) than the cost of equity. Low debt-to-equity ratios indicate that a company is not taking advantage of the
increased profits that financial leverage may bring.
Weaknesses - Trade Accounts Receivable
Increasing accounts receivable affect the companys competitiveness and profitability. Its total accounts receivables
increased to INR79,995.7m in 2011 from INR65,436.9m in 2010, showing an increase of 22.2% over the period. The
company entered into several factoring agreements with third party credit providers and ventures on short term of 30 to 90
days. For which, the company reported a provision of INR678.19m of doubtful accounts provision for impairment of loss,
during 2011. Such increasing doubtful debts, along with accounts receivable, reflect inefficient credit management by the
company. In the backdrop of growing economic recession, the probability of defaults by creditors increased, which may
impact the overall financial position as well as profitability of the company.
4.4
Hindalco Industries Limited - Opportunities
Opportunities - Positive Outlook for Copper Market

According to International Copper Study Group (ICSG), an increase in copper production and lower demand for the metal
are expected to create a balanced market by 2013. ICSG estimates that mine production, refined production, and refined
usage are expected to grow 9.4%, 3.4%, and 3.6% in 2012 reaching 17.61 million tons, 20.13 million tons, and 20.39
million tons respectively over that in the previous year. By 2012, copper producers anticipate a strong growth of 9% or 1.5
million metric tons mainly due to higher capacity utilization at existing mines as few new projects are expected to start.
Most of the developed countries are facing issues such as economic crisis, political disturbances in the Middle East and
North Africa, and market price volatility, which are leading to significant uncertainty. Emerging economies such as China
are expected to drive the growth in copper demand. China is expected to account for about 1% of the world copper
demand in 2011, which would increase in the future. Global copper consumption is expected to reach close to 38 million
tons per year (Mt/y) by 2035, more than double the current consumption. Catering to the higher demand in such markets
would increase the earning capabilities of the company.
Opportunities - Business Expansion Activities
The company under its operational efficiency has undertaken several expansion activities, for expanding its product profile
as well as asset base. Some of the expansion activities include, Hirakud smelter expansion at Hirakud from 155 KTPA to
161 KTPA was completed in 2011; it is also further expanding its capacity from 161 KTPA to 213 KTPA, along with a
100MW captive power plant to be completed by 2012. In addition, the company is evaluating the next phase of expansion
for the smelter 213 KTPA to 360 KTPA, with a corresponding increase in power plant capacity from 467.5MW to
967.5MW. It also has Hirakud flat rolled products project under development with underway of all key equipment for FRP
production from Novelis plant at Rogerstone, UK to Hirakud. In addition, Belgaum special alumina plant is under
expansion from 189 KTPA to 301 KTPA, with a coal based co-generation power plant. Besides, the companys Greenfield
projects is on course of development, of these projects, two aluminum smelters and one large alumina refinery viz. Mahan
Aluminium, Aditya Aluminium and Utkal Alumina are in advance stage of execution with a capital outlay of $5 billion. With
such project expansion and business development activities, the company would expand its productivity as well as
financial growth prospects.
Opportunities - Growing Demand for Aluminium
With the growing requirements of industrial, automobile and infrastructure sector, the growth momentum of aluminium
from most economies has commenced facing strong headwinds of growth modernization. In 2010, the world aluminium
consumption stood at around 41 million tones with a sharp increase of over 20% over 34 million tones consumption during
2009. Production of aluminium stood marginally with higher rate of 42 million tones against production of 38 million tonnes
during 2009. Strong demand from both emerging markets and developed markets on the back of increased Industrial
activity fuelled the demand for commodities. However, the emerging markets continued to be the torchbearer for this
growth; whereas the strong demand for aluminium from developed market was primarily driven by restocking post crisis.
For instance, China continued to be the driving force behind this demand growth which grew at 21% and contributed over
41% of global aluminium demand in the year 2010. Besides, the global aluminium production too increased as the
producers restarted their capacities with the recovery in the aluminium market. Such long-term fundamentals for
aluminium remain strong with a diverse and growing demand base coupled with high levels of supply-side activity.
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4.5
Hindalco Industries Limited - Threats
Threats - Project Execution Risk

The metal and mining companies are subject to various risks associated with the industry and its processes. These risks
range from prospecting to extraction and getting the product to the market. The risk category includes land acquisition,
project management skills, timely delivery of equipments, regulatory approvals, changes in government policies,
inflationary factors and security risks. Project risks include factors like feasibility determination, mine development and
mine closure while Technical risks include mine planning, grade control, reserve risk, metallurgic risk, input costs and
extraction risks. Social risks include employee health, safety, community and environmental while product chain risks
include stockpiling, intermediate processing, blending, joint and by products and transportation. The company also faces
Political and security risks associated with political uncertainties as well as mine and product security risks. Thus, any
failure by Hindalco in assessing its risk exposure as well as processes and procedures could have a major impact on its
business operations.
Threats - Fluctuations in Commodity Prices
The commodity markets are vulnerable to changes in economic conditions. Refinancing needs of approximately 300
billion in the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain) are expected to spill over to other regions
resulting in adverse feedback loop. In early 2010, fears of a sovereign debt crisis raised concerns about some European
countries, including Portugal, Ireland, Italy, Greece, Spain, and Belgium. Such crises could lead to increasing deficit,
followed by an increase in debt and economy downgrades, ultimately leading to high defaults. Concerns about European
debt have now been combined with crises in the Middle East and North Africa, along with uncertain US economic
recovery. The price of copper slumped from $10,190/ton in February 2011 to $7,600/ton in November 2011, as a result of
the global crisis. Such uncertain market conditions leading to changes in commodity prices could have an adverse impact
on the results of operation and financial condition of mining companies.
Threats - Structural Deficit
Copper is one of the main indicators of global economic growth as it is used in the construction of buildings, power
generation, and transmission and manufacture of consumer electronics. As per historical data it has been noticed that
higher the demand for copper stronger the economic growth. According to International Copper Study Groups (ICSG)
projections, the global demand for copper in 2011 is expected to exceed global growth in copper production, and a
production deficit of about 200,000 metric tons of refined copper is projected for the full year. Higher demand with low
supply levels is known as structural deficit. For 2012, ICSG projects a deficit of about 250,000 tons as supply growth will
continue to lag behind demand growth. The major reasons behind such deficit include falling copper ore grades in existing
mines, production disruptions due to labor strikes, and delay in commissioning new projects. All these factors could lead
to an increase in production costs, which will have a negative impact over the companys business, operating results and
financial condition.
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5 Hindalco Industries Limited - Company Statement

A statement by Mr. Kumar Mangalam Birla, the chairman of Hindalco Industries Limited is given below. The statement has
been taken from the companys 2011-12 annual report.
Almost four years after the greatest financial and economic upheaval since the Great Depression, the global economy is
regaining a measure of stability and confidence. But the risks to growth looks unsteady once again, with the problems in
the Euro Zone. The IMF projects that the global economic growth will decline from 4% in 2011 to 3.5% in 2012, before
picking upto 4% in 2013. The
Euro zone shows signs of slipping into a recession again, though that is expected to be offset by around 2% growth in the
US and 6% in the emerging and developing economies. The economies of Africa, particularly Sub-Saharan Africa, are
demonstrating structural improvement. Japan is on the road to normalcy after the twin disasters of the tsunami and the
Fukushima nuclear reactor accident. The global supply chains, disrupted by the disasters in Japan and the floods in
Thailand, have been restored. The financial condition of the large global corporations is extremely strong and their cash
holdings at an all-time high. The worst-case scenarios for the global economy have not come to pass. That, in no small
measure, is due to the unprecedented stimulus provided by governments and
central banks. Europe has also reached a degree of consensus on fiscal reforms. The ECB has also put in place firewalls
to ward off a widespread economic contagion. Clearly, the road ahead is not yet smooth. The bond, inter-bank and
sovereign debt markets in Europe remain jittery. The process of financial deleveraging still has a long way to go. Oil prices
remain stubbornly high. Unemployment is proving extremely sticky and concerns about inequality are growing. A major
worry is the political gridlock in many major countries, that makes it difficult to strike the right trade-offs between growth
and fiscal and monetary restraint.
The Indian economy was quick off the mark in recovering after the 2008 shocks. But the growth momentum has slowed
considerably over the past year. GDP growth in the third quarter of FY 2011-12 was 6.1%, down from 8.3% in the
corresponding quarter of FY 2010-11. Some of the key
indicators are bearish. Gross Fixed Capital formation has
contracted in recent months. Growth in Industrial production in the April 2011-February 2012 period slid to 3.5%
compared to 8.1% during the same period last year.
Inflation particularly in food items, remains high. There have been major slippages on the fiscal side. The Current account
deficit, in the April-December 2011 period widened to 4.0% of GDP, a clear warning sign. On a trade-weighted basis the
Rupee depreciated around 8% in the past year. Given the slippage in growth, RBIs decision to ease monetary policy was
timely. Even so monetary policy will not be effective unless it is supported by fiscal restraint. Indias economy is poised
delicately. Recent policies have not taken the economy forward. For the Financial Year 2011-12, your Companys
performance has been outstanding both at the Standalone and Consolidated level. Your Companys net revenue on a
Consolidated basis stood at US$ 17 billion (` 80,821 crore) vis--vis US$ 15.85 billion (` 72,202 crore) achieved in the
previous year. Net profit is in excess of US$ 700 million (` 3,397 crore) as against US$ 540 million (` 2,456 crore). These
numbers are indeed very encouraging. Your Companys model of a balanced portfolio with strong value added
businesses and operational excellence have been the key drivers of this commendable performance. Aluminium business
in India recorded the highest ever metal production. Cost pressures were largely neutralized through greater efficiencies.
Copper business in India attained the highest ever profitability led by improvement in recovery, product-mix and by
maximizing the value from by-products.
Novelis too reported strong operating results, braving the economic headwinds globally, recording the second straight
year of adjusted EBITDA in excess of $1 billion. Even as its shipments slowed, its EBITDA per ton continued to grow.
Significant initiatives taken towards optimizing the Companys footprint and rationalizing the cost structure, have stood
the Company in good stead. Novelis increased the recycled content in its production to 39% in FY12 from 33% in the
previous year, which is notable. All of its major strategic expansions in Brazil, South Korea and the United States are on
track. Importantly, we have ventured into China with a plant that will initially focus on automotive sheet fin ishing
capabilities. This will further solidify our global automotive leadership position. All through the year, at Novelis strateg ic
investments were made in global recycling facilities in South America, Europe and Germany. These facilities ensure metal
supply and optimization of the overall cost base.
Novelis investments have been strategically geared to leverage growth opportunities in the emerging markets, the
increasing emphasis on light-weighting in the automobile industry and recycling in all the four operating regions. Our
efforts to actively consolidate our pole position in the metals business in India as well are firmly rooted. All of your
Companys expansion projects are on course. Let me highlight a few projects, which should be up and running in the near
future, in India. The Mahan Aluminium Project, Aditya Aluminium Project and Utkal Alumina Refinery are all at an
advanced stage of implementation. Poststabilization these will be amongst the lowest cost producers globally. The Flat
Rolled Products (FRP) project at Hirakud in Odisha which is underway will enable your Company to produce high-end
canbody stock. It will be distinctive being the only plant of its kind in India. It will give your Company a head start in th e
domestic and export markets. The Consolidated capex spends in FY 2011-12 was over US$ 2.3 billion (` 12,500 crore).
Outlook
Your Company is poised to achieve a quantum leap in the next few years in every respect volume, capabilities and
enhanced value for all its stakeholders. It is well on its way to becoming a premium global metals major with a robust
presence across the Upstream and Downstream parts of the value chain of both Aluminium and Copper. Your Company
has displayed tremendous resilience in the last few years with its impressive performance despite the significant slack in
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the economy globally. The new assets that the Company is building will undeniably encircle it with an even greater
competitive edge. Given thedistinctive growth path that we have charted, the onlydirection that your Company can go in
the years ahead is upward. To our teams I thank all our teams for their solid performance, undiluted commitment and
laser sharp focus on delivering results. The Aditya Birla Group in perspective Despite a choppy global economy, our
Group turned in a solid performance in FY 2011-12, anchored by our 133,000 strong workforce comprising 42 nationalities
spanning 36 countries. Our consolidated revenues were a little over USD 40 billion, reflecting a 14% growth. It is my
abiding belief that our people are the single most important enablers from every perspective. It is with a sense of deep
pride that I share with you the fact that our continuous investment in the people area has paid rich dividends. Our Group
has been ranked fourth in the Global Top Companies for Leaders and first in Asia Pacific in the Top Companies for
Leaders 2011 study conducted by Aon Hewitt, Fortune and the RBL Group. 470 companies worldwide participated in
this study. This recognition is personally heartening for me, given that we have competed against the best of breed global
companies. I personally am convinced that we are now forging ahead on the people front. Our dedicated efforts in
enhancing the quality of life of our employees and their families, continues unabated. Our Talent Management and
Leadership Development processes have been further enhanced, to meet our very specific talent requirements, with
many more employees being included. To mention a few, launched:
A Global Manufacturing Leadership Program to induct lateral recruits and fortify our technical talent in our Units.
AContinuing Education Policy to support managers in acquiring higher specialist education for skills upgradation while
they continue to be in their jobs.
Cutting Edge, the accelerated P&L Leadership Development Program, to enable function leaders to
transition to P&L roles.
And over 30,000 touch points to our learners through multiple learning formats. With these the number of people being
targeted for honing competencies and developing skills has risen many times over. This is in sync with our World of
Opportunities proposition.
The customization of these learning programmes is far sharper this year on.
Beyond Business
Given that our employees have a desire to contribute to the larger community, including those of their colleagues who
need support, we are setting up a new trust called the World Of Opportunities Foundation, thorough which our
employees can contribute to supporting the higher education of children in need. Last Man Standing First Man Forward
And finally let me add that over the years, we have through determined and deliberate effort come to be in this position of
being the Last Man Standing, almost across each of our businesses. And when we do face a downturn today, from our
position of strength, the message I want to convey is that, the last man standing has the best chance at being the first
man forward. The first man forward to consolidate market positions, to show superior
performance in each industry and get a few steps ahead of competition.
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6 Hindalco Industries Limited - History

Table 4: Hindalco Industries Limited - History
Year
Event type
Description
2011
Corporate Changes/Expansions
In June, the company announced the investment of $15.8 million in the construction of
a new continuous casting line at its production facility in Pieve Emanuele, Italy.
2010
Corporate Changes/Expansions
In October, the company started setting up a 1.5 mtpa alumina refinery in the eastern
state of Orissa to feed Mahan and Aditya smelters.
2010
Corporate Awards
Hindalco Renukoot won the Golden Peacock Award 2010 for corporate social
responsibility.
2008
Contracts/Agreements
Hydromine Inc., together with its strategic partners Hindalco Industries Limited and
Dubai Aluminium Co., established a new mineral firm, Cameroon Alumina Ltd.
2007
Acquisitions/Mergers/Takeovers The company completed the acquisition of Novelis.
2007
Acquisitions/Mergers/Takeovers
2003
Acquisitions/Mergers/Takeovers The company completed the acquisition of copper mining assets in Australia.
2003
Acquisitions/Mergers/Takeovers
2000
Acquisitions/Mergers/Takeovers Hindalco completed the acquisition of Indal.
1998
Corporate Changes/Expansions Hindalco established new aluminum foil plant in Silvassa.
1994
Others
1967
Corporate Changes/Expansions The company opened its new plant at Renusagar.
1962
Others
Hindalco started production of aluminum metal and alumina.
1958
Incorporation/Establishment
Hindalco Industries Limited was incorporated in 1958.
The company acquired 100% interest of Alcan Inc. Canada (Alcan) in Utkal Alumina
International Ltd.
The company completed the acquisition of the Nifty copper mine and the rights to
explore seven more mines.
The company got ISO 9002 certification.
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7 Hindalco Industries Limited - Key Employees

Table 5: Hindalco Industries Limited - Key Employees
Name
Job Title
Board Level
Since
Age
Sanjay Sehgal
President - Chemicals & International

Trade
Senior Management
Anil Malik
Secretary
Senior Management
Askaran Agarwala
Director
Non Executive Board
Bharat Bhushan Jha
President - Corporate Projects &

Procurement
Senior Management
Chaitan Manbhai Maniar
Director
Non Executive Board
75
Vice Chairperson - Novelis Inc,

Debnarayan Bhattacharya Managing Director, Chairperson Aditya Birla Minerals Limited
Executive Board
62
Dilip Gaur
President - Copper
Senior Management
Dinesh Kumar Kohly
Chief Operating Officer - Renukoot &

Renusagar Units
Senior Management
Jagdish Khattar
Director
Non Executive Board
Kailash Nath Bhandari
Director
Non Executive Board
69
Kumar Mangalam Birla
Chairperson
Non Executive Board
44
Madhukar Manilal Bhagat Director
Non Executive Board
Meleveetil Damodaran
Director
Non Executive Board
Narendra
Jhaveri
Director
Non Executive Board
Philip Martens
Chief Executive Officer - Novelis Inc. ,

President - Novelis Inc.
Senior Management
Praveen Maheshwari
Chief Financial Officer
Senior Management
Raghavendra Dhulkhed
Senior President Operations
Senior Management
Rajashree Birla
Director
Non Executive Board
Ram Charan
Director
Non Executive Board
Sachin Satpute
Chief Marketing Officer - Aluminium
Senior Management
Satish M Bhatia
President Foil & Packaging
Senior Management
Jamnadas
2012
65
2011
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Table 5: Hindalco Industries Limited - Key Employees

Name
Job Title
Board Level
Sunil Kulwal
Chief Executive Officer - Aditya Birla

Minerals Limited, Managing Director Aditya Birla Minerals Limited
Suryakant Mishra
Chief Executive Officer - Utkal Alumina

Senior Management
International Ltd
Vineet Kaul
Chief People Officer
Since
Age
Senior Management
Senior Management
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8 Hindalco Industries Limited - Key Employee Biographies

Table 6: Hindalco Industries Limited - Key Employee Biographies
Praveen Maheshwari
Job Title : Chief Financial Officer
Mr. Maheshwari has been the chief financial officer of the

Hindalco Industries Limited since 2012.
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9 Hindalco Industries Limited - Locations and Subsidiaries

9.1
Hindalco Industries Limited - Head Office

Aditya Birla Centre
Mumbai
Zip: 400030
India
Tel: + 91 22 66525000
Fax: + 91 22 66525841
9.2
Hindalco Industries Limited - Other Locations and Subsidiaries
Table 7: Hindalco Industries Limited - Subsidiaries

Novelis Inc.
3560 Lenox Road
Suite 2000
Atlanta
Zip: 30326
Tubed Coal Mines Limited

Latehar
India
United States of America

Tel: + 1 404 7604000
Lucknow Finance Company Limited
Minerals & Minerals Limited
India
India
Aditya Birla Minerals Limited

Level 3, Septimus Roe Square
Novelis (India) Infotech Limited
256 Adelaide Terrace
Pune
Perth
India
Zip: 6000
Tel: + 91 20 25888681
Australia
Tel: + 61 8 93668800
Fax: + 61 8 93668805
Aditya Birla Chemicals (India) Limited

10 Camac Street
Industry House,17th Floor
Dahej Harbour & Infrastructure Limited
Kolkata
Bharuch
Zip: 700 017
India
India
Tel: + 91 3322 826130
Fax: + 91 3322 826139
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Table 7: Hindalco Industries Limited - Subsidiaries

Utkal Alumina International Limited
Birla Resources Pty Limited
India
Australia
Hindalco-Almex Aerospace Limited

Century Bhavan, 3rd Floor
Dr. Annie Besant Road
Mumbai
Zip: 400 030
India
Tel: + 91 22 66626666
Fax: + 91 22 24227586
Table 8: Hindalco Industries Limited - Locations

Vandhana, 5th Floor
Industry House, 7th Floor
11 Tolstoy Marg
45, Race Course Road
New Delhi
Bangalore
Zip: 110 001
Zip: 560 001
India
India
Tel: + 91 11 42200204
Tel: + 91 80 40416010
Fax: + 91 11 23721595
Ahura Centre, 1st Floor
Jeevan Deep, 2nd Floor
82, Mahakali Caves Road
1, Middleton Street
Mumbai
Kolkata
Zip: 400 093
Zip: 700 071
India
India
Tel: + 91 22 66917031
Tel: + 91 33 22809710
Fax: + 91 80 22533086
Fax: + 91 33 22886139
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10 Appendix
10.1 Methodology
World Market Intelligence company reports are based on a core set of research techniques which ensure the best
possible level of quality and accuracy of data. The key sources used include:
Company Websites
Company Annual Reports
SEC Filings
Press Releases
Proprietary Databases
Notes
Financial information of the company is taken from the most recently published annual reports or SEC filings
The financial and operational data reported for the company is as per the industry defined standards
Revenue converted to US$ at average annual conversion rate as of fiscal year end
10.2 Ratio Definitions
Capital Market Ratios
Price/Earnings Ratio (P/E)
Capital Market Ratios measure investor response to owning a company's stock and also
the cost of issuing stock.
Price/Earnings (P/E) ratio is a measure of the price paid for a share relative to the annual
income earned per share. It is a financial ratio used for valuation: a higher P/E ratio
means that investors are paying more for each unit of income, so the stock is more
expensive compared to one with lower P/E ratio. A high P/E suggests that investors are
expecting higher earnings growth in the future compared to companies with a lower P/E.
Price per share is as of previous business close, and EPS is from latest annual report.
Formula: Price per Share / Earnings per Share
Enterprise Value/Earnings
before Interest, Tax,
Depreciation &
Amortization (EV/EBITDA)
Enterprise Value/EBITDA (EV/EBITDA) is a valuation multiple that is often used in parallel

with, or as an alternative to, the P/E ratio. The main advantage of EV/EBITDA over the PE
ratio is that it is unaffected by a company's capital structure. It compares the value of a
business, free of debt, to earnings before interest. Price per share is as of previous
business close, and shares outstanding last reported. Other items are from latest annual
report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / (Net
Income + Interest + Tax + Depreciation + Amortization)
Enterprise Value/Sales
Enterprise Value/Sales (EV/Sales) is a ratio that provides an idea of how much it costs to
buy the company's sales. EV/Sales is seen as more accurate than Price/Sales because
market capitalization does not take into account the amount of debt a company has, which
needs to be paid back at some point. Price per share is as of previous business close,
and shares outstanding last reported. Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Sales
Enterprise
Value/Operating Profit
Enterprise Value/Operating Profit measures the company's enterprise value to the

operating profit. Price per share is as of previous business close, and shares outstanding
last reported. Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Operating
Income
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Enterprise Value/Total
Assets
Enterprise Value/Total Assets measures the company's enterprise value to the total
assets. Price per share is as of previous business close, and shares outstanding last
reported. Other items are from latest annual report.
Formula: (Market Cap + Debt + Preferred Stock - Cash & Cash Equivalents) / Total
Assets
Dividend Yield
Dividend Yield shows how much a company pays out in dividends each year relative to its
share price. In the absence of any capital gains, the dividend yield is the return on
investment for a stock.
Formula: Annual Dividend per Share / Price per Share
Equity Ratios
Earnings per Share (EPS)
These ratios are based on per share value.
Earnings per share (EPS) is the portion of a company's profit allocated to each
outstanding share of common stock. EPS serves as an indicator of a company's
profitability.
Formula: Net Income / Weighted Average Shares
Dividend per Share
Dividend Cover
Dividend is the distribution of a portion of a company's earnings, decided by the board of

directors, to a class of its shareholders.
Dividend cover is the ratio of company's earnings (net income) over the dividend paid to
shareholders.
Formula: Earnings per share / Dividend per share
Book Value per Share
Book Value per Share measure used by owners of common shares in a firm to determine
the level of safety associated with each individual share after all debts are paid
accordingly.
Formula: (Shareholders Equity - Preferred Equity) / Outstanding Shares
Cash Value per Share
Cash Value per Share is a measure of a company's cash (cash & equivalents on the
balance sheet) that is determined by dividing cash & equivalents by the total shares
outstanding.
Formula: Cash & equivalents / Outstanding Shares
Profitability Ratios
Gross Margin
Profitability Ratios are used to assess a company's ability to generate earnings, based on
revenues generated or resources used. For most of these ratios, having a higher value
relative to a competitor's ratio or the same ratio from a previous period is indicative that
the company is doing well.
Gross margin is the amount of contribution to the business enterprise, after paying for
direct-fixed and direct variable unit costs.
Formula: {(Revenue-Cost of revenue) / Revenue}*100
Operating Margin
Operating Margin is a ratio used to measure a company's pricing strategy and operating
efficiency.
Formula: (Operating Income / Revenues) *100
Net Profit Margin
Net Profit Margin is the ratio of net profits to revenues for a company or business segment
- that shows how much of each dollar earned by the company is translated into profits.
Formula: (Net Profit / Revenues) *100
Profit Markup
Profit Markup measures the company's gross profitability, as compared to the cost of
revenue.
Formula: Gross Income / Cost of Revenue

PBIT Margin (Profit Before
Interest & Tax)
Profit Before Interest & Tax Margin shows the profitability of the company before interest
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expense & taxation.

Formula: {(Net Profit + Interest + Tax) / Revenue} *100
PBT Margin (Profit Before
Tax)
Profit Before Tax Margin measures the pre-tax income over revenues.
Formula: {Income Before Tax / Revenues} *100
Return on Equity
Return on Equity measures the rate of return on the ownership interest (shareholders'
equity) of the common stock owners.
Formula: (Net Income / Shareholders Equity)*100
Return on Capital
Employed
Return on Capital Employed is a ratio that indicates the efficiency and profitability of a
company's capital investments. ROCE should always be higher than the rate at which the
company borrows; otherwise any increase in borrowing will reduce shareholders'
earnings.
Formula: EBIT / (Total Assets Current Liabilities)*100
Return on Assets
Return on Assets is an indicator of how profitable a company is relative to its total assets,
the ratio measures how efficient management is at using its assets to generate earnings.
Formula: (Net Income / Total Assets)*100
Return on Fixed Assets
Return on Fixed Assets measures the company's profitability to its fixed assets (property,
plant & equipment).
Formula: (Net Income / Fixed Assets) *100
Return on Working Capital
Return on Working Capital measures the company's profitability to its working capital.
Formula: (Net Income / Working Capital) *100
Cost Ratios
Operating costs (% of
Sales)
Cost ratios help to understand the costs the company is incurring as a percentage of
sales.
Operating costs as percentage of total revenues measures the operating costs that a
company incurs compared to the revenues.
Formula: (Operating Expenses / Revenues) *100
Administration costs as percentage of total revenue measures the selling, general and
Administration costs (% of
administrative expenses that a company incurs compared to the revenues.
Sales)
Formula: (Administrative Expenses / Revenues) *100
Interest costs (% of Sales)
Interest costs as percentage of total revenues measures the interest expense that a
company incurs compared to the revenues.
Formula: (Interest Expenses / Revenues) *100
Leverage Ratios
Debt to Equity Ratio
Leverage ratios are used to calculate the financial leverage of a company to get an idea of
the company's methods of financing or to measure its ability to meet financial obligations.
There are several different ratios, but the main factors looked at include debt, equity,
assets and interest expenses.
Debt to Equity Ratio is a measure of a company's financial leverage. The debt/equity ratio
also depends on the industry in which the company operates. For example, capitalintensive industries tend to have a higher debt equity ratio.
Formula: Total Liabilities / Shareholders Equity
Debt to Capital Ratio
Debt to capital ratio gives an idea of a company's financial structure, or how it is financing
its operations, along with some insight into its financial strength. The higher the debt-tocapital ratio, the more debt the company has compared to its equity. This indicates to
investors whether a company is more prone to using debt financing or equity financing. A
company with high debt-to-capital ratios, compared to a general or industry average, may
show weak financial strength because the cost of these debts may weigh on the company
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and increase its default risk.

Formula: {Total Debt / (Total assets - Current Liabilities)}
Interest Coverage Ratio
Interest Coverage Ratio is used to determine how easily a company can pay interest on
outstanding debt, calculated as earnings before interest & tax by interest expense.
Formula: EBIT / Interest Expense
Liquidity Ratios
Current Ratio
Liquidity ratios are used to determine a company's ability to pay off its short-terms debts
obligations. Generally, the higher the value of the ratio, the larger the margin of safety that
the company possesses to cover short-term debts. A company's ability to turn short-term
assets into cash to cover debts is of the utmost importance when creditors are seeking
payment. Bankruptcy analysts and mortgage originators frequently use the liquidity ratios
to determine whether a company will be able to continue as a going concern.
Current Ratio measures a company's ability to pay its short-term obligations. The ratio
gives an idea of the company's ability to pay back its short-term liabilities (debt and
payables) with its short-term assets (cash, inventory, receivables). The higher the current
ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests
that the company would be unable to pay off its obligations if they came due at that point.
Formula: Current Assets / Current Liabilities
Quick Ratio
Quick ratio measures a company's ability to meet its short-term obligations with its most
liquid assets.
Formula: (Current Assets - Inventories) / Current Liabilities
Cash Ratio
Cash ratio is the most stringent and conservative of the three short-term liquidity ratio. It
only looks at the most liquid short-term assets of the company, which are those that can
be most easily used to pay off current obligations. It also ignores inventory and
receivables, as there are no assurances that these two accounts can be converted to
cash in a timely matter to meet current liabilities.
Formula: {(Cash & Bank Balance + Marketable Securities) / Current Liabilities)}
Efficiency Ratios
Fixed Asset Turnover
Efficiency ratios measure a company's effectiveness in various areas of its operations,

essentially looking at maximizing its use of resources.
Fixed Asset Turnover ratio indicates how well the business is using its fixed assets to
generate sales. A higher ratio indicates the business has less money tied up in fixed
assets for each currency unit of sales revenue. A declining ratio may indicate that the
business is over-invested in plant, equipment, or other fixed assets.
Formula: Net Sales / Fixed Assets
Asset Turnover
Asset turnover ratio measures the efficiency of a company's use of its assets in
generating sales revenue to the company. A higher asset turnover ratio shows that the
company has been more effective in using its assets to generate revenues.
Formula: Net Sales / Total Assets
Current Asset Turnover
Current Asset Turnover indicates how efficiently the business uses its current assets to
generate sales.
Formula: Net Sales / Current Assets
Inventory Turnover
Inventory Turnover ratio shows how many times a company's inventory is sold and
replaced over a period. A low turnover implies poor sales and, therefore, excess
inventory. A high ratio implies either strong sales or ineffective buying.
Formula: Cost of Goods Sold / Inventory
Working Capital Turnover
Working Capital Turnover is a measurement to compare the depletion of working capital

to the generation of sales. This provides some useful information as to how effectively a
company is using its working capital to generate sales.
Formula: Net Sales / Working Capital
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Capital Employed
Turnover
Capital employed turnover ratio measures the efficiency of a company's use of its equity
in generating sales revenue to the company.
Formula: Net Sales / Shareholders Equity
Capex to sales
Capex to Sales ratio measures the company's expenditure (investments) on fixed and
related assets' effectiveness when compared to the sales generated.
Formula: (Capital Expenditure / Sales) *100
Net income per Employee
Net income per Employee looks at a company's net income in relation to the number of
employees they have. Ideally, a company wants a higher profit per employee possible, as
it denotes higher productivity.
Formula: Net Income / No. of Employees
Revenue per Employee
Revenue per Employee measures the average revenue generated per employee of a
company. This ratio is most useful when compared against other companies in the same
industry. Generally, a company seeks the highest revenue per employee.
Formula: Revenue / No. of Employees
Efficiency Ratio
Efficiency Ratio is used to calculate a bank's efficiency. An increase means the company
is losing a larger percentage of its income to expenses. If the efficiency ratio is getting
lower, it is good for the bank and its shareholders.
Formula: Non-interest expense / Total Interest Income
Source : World Market Intelligence
10.3 Disclaimer
All Rights Reserved
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means,
electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, World Market
Intelligence.
The data and analysis within this report is driven by World Market Intelligence from its own primary and secondary
research of public and proprietary sources and does not necessarily represent the views of the company profiled.
The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the
findings, conclusions and recommendations that World Market Intelligence delivers will be based on information gathered
in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As
such World Market Intelligence can accept no liability whatever for actions taken based on any information that may
subsequently prove to be incorrect.
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Hindalco Industries Limited

Hindalco Industries Limited

Aditya Birla Centre, Mumbai, 400030,India

Ticker Symbol, Stock Exchange

500440, Bombay Stock

Fiscal Year End

Revenue (in US$ million)

The company reported revenue of US$15,190 million

Low Debt to Equity Ratio

Dominant Market Position

Trade Accounts Receivable

Efficient Liquidity Position

Business Expansion Activities

Fluctuations in Commodity Prices

Growing Demand for Aluminium

Project Execution Risk

Positive Outlook for Copper Market

Hindalco Industries Limited

Hindalco Industries Limited - Business Analysis ............................................................................... 5

Hindalco Industries Limited - Company Overview ............................................................................................. 5

Hindalco Industries Limited - Business Description........................................................................................... 5

Hindalco Industries Limited - Major Products and Services............................................................................... 7

Hindalco Industries Limited - Analysis of Key Performance Indicators ............................................. 8

Hindalco Industries Limited - Key Financial Performance Indicators ............................................................... 11

Hindalco Industries Limited - Revenue and Operating Profit ....................................................................... 11

Hindalco Industries Limited - Asset and Liabilities ...................................................................................... 12

Hindalco Industries Limited - Net Debt vs. Gearing Ratio ........................................................................... 13

Hindalco Industries Limited - Operational Efficiency ................................................................................... 14

Hindalco Industries Limited - Solvency....................................................................................................... 15

Hindalco Industries Limited - Key Competitors ............................................................................................... 16

Hindalco Industries Limited - Recent Developments ....................................................................... 17

Hindalco Industries Limited - SWOT Analysis .................................................................................. 18

Hindalco Industries Limited - SWOT Analysis - Overview ............................................................................... 18

Hindalco Industries Limited - Strengths .......................................................................................................... 18

Hindalco Industries Limited - Weaknesses ..................................................................................................... 19

Hindalco Industries Limited - Opportunities .................................................................................................... 19

Hindalco Industries Limited - Threats ............................................................................................................. 20

Hindalco Industries Limited - Company Statement .......................................................................... 21

Hindalco Industries Limited - History ............................................................................................... 23

Hindalco Industries Limited - Key Employees .................................................................................. 24

Hindalco Industries Limited - Key Employee Biographies ............................................................... 26

Hindalco Industries Limited - Locations and Subsidiaries ............................................................... 27

Hindalco Industries Limited - Head Office....................................................................................................... 27

Hindalco Industries Limited - Other Locations and Subsidiaries ...................................................................... 27

Ratio Definitions ............................................................................................................................................ 29

Hindalco Industries Limited

Hindalco Industries Limited - Business Analysis ............................................................................... 5

Hindalco Industries Limited - Company Overview ............................................................................................. 5

Hindalco Industries Limited - Business Description........................................................................................... 5

Hindalco Industries Limited - Major Products and Services............................................................................... 7

Hindalco Industries Limited - Analysis of Key Performance Indicators ............................................. 8

Hindalco Industries Limited - Key Financial Performance Indicators ............................................................... 11

Hindalco Industries Limited - Revenue and Operating Profit ....................................................................... 11

Hindalco Industries Limited - Asset and Liabilities ...................................................................................... 12

Hindalco Industries Limited - Net Debt vs. Gearing Ratio ........................................................................... 13

Hindalco Industries Limited - Operational Efficiency ................................................................................... 14

Hindalco Industries Limited - Solvency....................................................................................................... 15

Hindalco Industries Limited - Key Competitors ............................................................................................... 16

Hindalco Industries Limited - Recent Developments ....................................................................... 17

Hindalco Industries Limited - SWOT Analysis .................................................................................. 18

Hindalco Industries Limited - SWOT Analysis - Overview ............................................................................... 18

Hindalco Industries Limited - Strengths .......................................................................................................... 18

Hindalco Industries Limited - Weaknesses ..................................................................................................... 19

Hindalco Industries Limited - Opportunities .................................................................................................... 19