National Aluminium Company to hike prices

New Delhi, Mar 30 (PTI) National Aluminium Company (Nalco) is likely to increase the price of the metal by Rs 2,000-3,000 a tonne with effect from April, in sync with firming global prices.

Sources in Nalco said that a decision on the impending price rise will be taken tomorrow and the hike will be effective April 1.

However, when contacted, Nalco''s acting Chairman-cum-Managing Director B L Bagra said as a matter of policy, the company does not give any price outlook.

Sources, however, said the price rise was necessary to ensure parity with import prices and to pass on the rise in input costs. Dollar weakness has also contributed to the rise in aluminium prices.

The price of aluminium on the London Metal Exchange (LME) is currently hovering at around USD 2,570 a tonne.

Global production of aluminium currently stands at 39-40 million tonnes per annum. Demand also stands at around the same level. Meanwhile, some smelters have been closed in China in the recent past, leading to firming up of the price, they said.

They, however, added the current "small" demand-supply mismatch is only a temporary phenomenon as with the firming up of the price, the closed smelters have again resumed operation.

Nalco, the second-biggest producer of aluminium in the country, had also raised prices in January, but corrected them in the third week of the month itself as the global price slackened.

It again raised the price by Rs 6,000 to around Rs 1.21 lakh a tonne in February, but reduced the rate by Rs 2,500 per tonne in March.

In a communique to shareholders earlier this month, Nalco said that it hopes to clock an over 23 per cent rise in net profit in the current fiscal to Rs 1,005 crore on higher metal prices.

The company, which reported a Rs 814.22 crore net profit in FY''10, aims to clock a Rs 1,098.24 crore net profit next fiscal and Rs 1,252 crore in 2012-13.

Nalco, in which the government owns an around 87 per cent stake, also hopes that its net sales will go up by 14.27 per cent to Rs 5,777.31 crore in FY''11 against Rs 5,055.66 crore in FY''10.