Debu Bhattacharya, a veteran of the Aditya Birla group and the managing director of group flagship Hindalco Industries, has decided to step down from his post. Bhattachrya, 68, will demit office from August 1, 2016 and will be succeeded by his deputy, Satish Pai.
Bhattacharya will however continue his association with the group as vice-chairman of Hindalco, a post created for the first time in the Mumbai-based conglomerate.
“I have done my innings and have spent 13 long years in Hindalco. I felt it is time for me to move on and also let younger people come in,” Bhattacharya told HT. “I will now continue as vice chairman in a non-executive role,” said Bhattacharya.
On Saturday, the Hindalco board appointed Satish Pai as MD for a period of five years and also inducted CFO, Praveen Maheshwari, on to the board. The company said that it had also appointed prominent lawyer Girish Dave as an independent director on board.
The change in Hindalco’s top guard was unexpected and has come at a time when the company reported strong growth in its fiscal year performance. Hindalco, one of India’s largest producers of aluminium and copper, on Saturday reported a more-than-doubling of the Jan-March standalone net profit at Rs 356 crore, compared to Rs 160 crore in the same period last year. Its revenue however fell 8% to Rs 8,668 crore due to a fall in prices of aluminium and copper.
“The company perforamance has been despite unfavourable macro-economic conditions, where we lost a coal mine and at a time when international growth was weak,” said Bhattacharya. “Fortunately Indian aluminium growth was good.” While global aluminium demand grew 5-6%, in India it was double of that.
Aluminum, which competes with steel as a metal to be used in transport vehicles, has been scoring more in cars as its relatively lighter weight implies less fuel consumption. It is the metal of choice in aircraft and is also used largely as beverage cans. The metal is also amenable to recycling.
Hindalco said its depreciation and finance costs were up 30%, given the progressive capitalisation of greenfield projects. These charges rose by Rs 212 crore over Rs704 crore charged in the Jan-March quarter last year.
The copper segment saw lower production due to operational related issues in one of the smelters. “These issues are being addressed through a planned maintenance shutdown,” said Hindalco.