|
|
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Sector Focus : Non-Ferrous Metals
Non-ferrous metals: Post-budget
Aluminium: State of the industry (2000-01)
| |
Tariffs
(per
cent) |
Prices
(Jan
2001) |
Landed
costs
(Rs/tonne) |
| |
Customs |
Excise |
Dom-
estic |
|
Intnl |
|
Pre-
budget |
Post
budget |
| |
00-01 |
01-02 |
2000-01 |
01-02 |
(Rs/ton) |
|
($/ton) |
|
|
|
|
Aluminium
ingots |
32.6 |
30.0 |
16.0 |
16.0 |
94,167 |
|
1,612 |
|
122,302 |
119,904 |
|
Aluminium
products |
44.0 |
40.4 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Aluminium
scrap |
44.0 |
40.4 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Non-coking
coal |
32.6 |
30.0 |
- |
- |
- |
|
- |
|
- |
- |
|
Caustic
soda |
44.0 |
40.4 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Calcined
petroleum
coke |
25.0 |
25.0 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Copper |
44.0 |
40.4 |
16.0 |
16.0 |
146,700 |
|
1,788 |
|
146,822 |
143,112 |
|
Copper
scrap |
44.0 |
40.4 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Copper
ore
and
concentrates |
9.7 |
9.2 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Nickel |
21.2 |
19.6 |
16.0 |
16.0 |
485,000 |
|
6,714 |
|
452,823 |
446,992 |
|
Nickel
ore
and
concentrates |
9.7 |
9.2 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Lead |
44.0 |
40.4 |
16.0 |
16.0 |
39,500 |
|
478 |
|
42,759 |
41,678 |
|
Lead
ore
and
concentrates |
9.7 |
9.2 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Zinc |
44.0 |
40.4 |
16.0 |
16.0 |
82,000 |
|
1,033 |
|
86,890 |
84,695 |
|
Zinc
ore
and
concentrates |
9.7 |
9.2 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
|
Tin |
32.6 |
30.0 |
16.0 |
16.0 |
375,600 |
|
5,170 |
|
382,621 |
375,119 |
|
Tin
ore
and
concentrates |
9.7 |
9.2 |
16.0 |
16.0 |
- |
|
- |
|
- |
- |
Note:
International prices are LME cash prices.
Source: CRIS INFAC
- Growth in demand for aluminium is expected to be at 3.7 per cent as compared with 5.3 per cent in 1999-2000, largely due to a significant decline in automobile production.
- Supply is expected to increase due to high operating rates of Nalco and Malco.
- In the first half of 2000-01, domestic prices of aluminium increased due to an increase in international prices. International prices increased due to a decline in supply from North America, where several smelters reduced production, as a result of a significant increase in power costs. Domestic prices also increased due to the depreciation of the rupee vis-à-vis the dollar.
- Margins of domestic aluminium producers are expected to remain stable as the increase in the cost of inputs, such as coal and fuel oil, is expected to offset the increase in realisations.
Copper: State of the industry (2000-01)
- Demand for copper is expected to increase, due to a significant growth in the cable (telecom) industry.
- Supply is expected to increase, due to higher capacity utilisation at Indo Gulf and Sterlite Industries' smelters.
- In the first half of 2000-01, average domestic prices increased, as compared with those in 1999-2000. Prices increased due to an increase in domestic demand and an increase in international prices. Domestic prices also increased due to the depreciation of the rupee vis-à-vis the dollar.
- Net profits of domestic copper producers are expected to increase, due to an increase in sales and realisations.
Zinc: State of the industry (2000-01)
- Demand for zinc is expected to be steady.
- Supply is expected to remain steady at the 1999-2000 levels.
- In the first half of 2000-01, average domestic prices increased, as compared with those in 1999-2000, due to an increase in international prices. Domestic prices also increased due to the depreciation of the rupee vis-à-vis the dollar.
- Operating margins and net margins of Hindustan Zinc Ltd. are expected to increase, due to an increase in prices.
Non-ferrous metals: Budget impact
Impact factors
|
Company
name |
Impact |
Impact
factors |
|
Balco |
Neg |
A,B |
|
(Not
listed) |
|
|
|
Hindalco |
Neg |
A,B |
|
(775.60,
770.80) |
|
|
|
Indal |
Neg |
A,B |
|
(108.35,110.25) |
|
|
|
Nalco |
Neg |
A,B |
|
(56.70,58.00) |
|
|
|
Sterlite
Industries |
Neg |
A,B |
|
(143.10,
149.60) |
|
|
Note:
Figures in brackets indicate the closing share prices, on February 27, 2001 and February 28, 2001, respectively.
Neg= negative
Source: CRIS INFAC
A: The reduction in the customs duty, due to the removal of the surcharge, is expected to have a negative impact on the producers of non-ferrous metals. The lower customs duty could have an impact on realisations, which could be partially offset due to an increase in sales volume for aluminum producers. Sales volume could increase as a result of a growth in the end-use segments, such as automobiles.
B: The reduction of surcharge on corporate tax, from 13 per cent to 2 per cent and the expected decline in interest rates, is expected to have a positive impact on producers.
Rediff-CRISIL Budget Impact Analysis
Budget 2001
Disclaimer: CRISIL has taken due care and caution in compiling this report. Information has been obtained by CRISIL from sources which it considers reliable. However, CRISIL does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. CRISIL is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of its web site.
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