Hindalco to invest USD 5 billion more, double aluminium capacity

 Hyderabad, Dec 6: Hindalco Industries Limited, the metals flagship company of the Aditya Birla Group, is looking to more than double its aluminium production capacity by 2016 with an investment of USD 5 billion.

Hindalco managing director D. Bhattacharya refused to put a number with regard to the capacity, saying he would not like give indications.

"We are investing USD 5 billion right now and it could be another USD 5 billion going forward," he told reporters on the sidelines of the 6th International Conference on Aluminium (INCAL), which began here Tuesday.

The company is already investing USD 5 billion in its three projects - Mahan Aluminium, Aditya Aluminium and Utkal Alumina.

Hindalco Industries chairman Kumar Mangalam Birla had said in September that once all the projects are commissioned, the company would have an aluminium capacity of 1.7 million tonnes.

The cost for the capacity addition will be USD 3,000 per tonne. On raising funds for new investments, Bhattacharya said it could be through debt or project financing or bonds.

Replying to a query, he said doubling the capacity would depend on forest clearance for Mahan coal block. "Without coal block, we will not put up a power plant and without power plant we will not up our smelter. Starting point is bauxite mine and coal mine. If we get the two, we will certainly go ahead."

He was confident that the Mahan plant would begin production in next three to five weeks. It will have a capacity of 360,000 tonnes of aluminium every year.

Bhattacharya, who is also the honorary president of Aluminium Association of India, said it was ironical that despite having enough resources of coal, bauxite and copper, India was importing these.

He predicted that aluminium consumption in India would double in five years. "It offers an opportunity to industry to grow to the same extent. If we don't grow, imports will come," he said.

He believed that the prices of aluminium would go up despite the global economic turmoil.

Bhattacharya said all problems faced by the industry including the concerns over coal and bauxite mining were brought to the government's notice and hoped that the government would act to solve them.