Nalco’s officials were not immediately available for comments on the company’s performance.
From the beginning of FY20, Nalco
has been battling the international alumina price pressure. In the first quarter, Nalco
could manage just a modest net profit of Rs 97.78 crore, bogged down by softening alumina prices. After peaking at over $600 per tonne, international alumina prices have halved to the level of around $300 a tonne on a year-to-date basis. Fragile alumina prices have squeezed realisations of the state-run aluminium producer while coming to the rescue of rival Vedanta
that imports substantial quantum of alumina to power its smelters.
Over the years, alumina sales have been propelling Nalco’s profitability. The company is still struggling to turn a profit from its aluminium business, weighed down by escalating power costs as well as hardening costs of other critical inputs.
Nalco’s total income for Q2 of FY20, too, fell 22 per cent to Rs 2,420.11 crore.
Last month, Nalco
was in the throes of an acute coal crisis that impacted its smelter operations at Angul (Odisha). More than 80 pots had gone offline as stir at coal mines of Mahanadi Coalfields Ltd (MCL) paralysed supplies. Nalco is fully dependent on MCL for sourcing coal and unlike its peers Hindalco Industries
and Vedanta, does not import to offset any deficit.