Slowdown to hit Aditya Birla Group’s Q3 performance

The $28-billion Aditya Birla Group, 50% of whose revenues flow from overseas operations, is expected to report a bleak Q3 performance in its main businesses in the current financial year,say experts.The group has a major presence in metals, cement, textile and telecom. According to experts, the fourth quarter of FY09 as well as the next year(FY2010)will be challenging for the group.

With base metal prices being corrected by more than 50% in the last couple of months, and demand for aluminum-rolled products slowing down in North America and Europe, Hindalco (including Novelis, the Canadian firm it acquired in early 2007 for $6 billion) is expected to degrow 12% in top line and bottom line in the third quarter of the fiscal.

Meanwhile,BNP Paribas has turned cautious on Novelis as US and Europe, which account for about 70% of Novelis’ deliveries, are witnessing a 912% dip in demand.“We expect Novelis to report a minor loss in 2009 due to lower volume and profit margin.

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Cement firms press alarm bell as topline melts

The 204 million tonne per annum cement industry in India is going through difficult times, as it faces double trouble with topline and operating margins both reeling under pressure.

Cement majors including ACC, UltraTech, Ambuja Cements and Binani Cement, among others, foresee tough times ahead. Significant raw material pressure and government control on cement prices have resulted in a negative growth in the bottomline and topline for these companies.

ACC Ltd, while declaring its Q3 results for the current year said, “We foresee challenging times ahead, in respect of markets, investments and input costs. While GDP growth targets for the country are being moderated to around 6.5% to 7%, ACC is of the view that growth of cement consumption in the coming months, particularly in the housing sector,may decline.”

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