Hindalco Plans $5.19B Expansion, Focuses on Recycling and Sustainability

1 Apr 2025 , 08:24 PM

Hindalco Industries announced its long-term plans for growth, focusing on sustainability, recycling, and capital investments to bolster its position in the market. Aluminium has been designated as a circular material with 75% recycled content, with plans to increase recycling capacity fourfold by FY30.

A major sustainability target is to cut CO2 emissions to less than 3 tonnes per tonne of flat-rolled products (FRP) delivered. Hindalco has pledged to invest $5.19 billion to expand its aluminium and copper production capacity while cementing its leadership position in the Indian market.

Capital allocation policies, which emphasize a balance between business growth and distributions to shareholders, see 8-10% of the free cash flows used for dividends.

Novelis, Hindalco’s US-based subsidiary and the world’s biggest aluminium roller and recycler, reported net sales of $16.6 billion in 12 months up to December 31, 2024. The subsidiary also had an adjusted EBITDA of $1.8 billion and is aiming for EBITDA over $600 per tonne.

Novelis is adjusting to changing dynamics in the scrap markets and ramping up its investments to grow its global aluminium production capacity.

Nearer term; from end CY25, we see positive impact of regional aluminium supply constraints through with our Bay Minette project (North America) due to ramp in the second half of CY26. Under Novelis, its capital projects are meant to fuel long-term growth and includes a $5 billion investment for multiple expansion projects.

Hindalco is well-positioned to capitalize on India’s soaring aluminum and copper consumption, which is seen doubling by FY35. It serves industries that account for 60% of India’s industrial GDP and focuses on areas of growth like battery enclosures, aerospace and foil production. Hindalco is enhancing the value-added product portfolio, leveraging captive coal mines and renewable energy sources to ensure cost efficiency.

A 300KT copper smelter expansion project is in progress to support the increasing domestic demand for copper. The company also has long-term sustainability goals like becoming water positive by 2050 and attaining net zero emissions.

Yes, although being integrated into operations; these are also enhanced via AI driven analytics, AR/VR applications, etc. Advanced digital initiatives are being incorporated into operations, including AI-driven analytics and AR/VR applications, to enhance efficiency and innovation.