Hindalco Shares in Focus as Novelis Q1 FY26 Profit Falls 36%; US Tariffs Add Pressure

Hindalco Industries share price remained in focus after its subsidiary Novelis Inc posted weak first quarter earnings for FY26, hurt by tariff related headwinds in the US market.

Q1 FY26 Financial Performance

For the quarter ended June 30, 2025, Novelis reported:

• Net income: $96 million, down 36% YoY
• Net income (ex-special items): $116 million, down 43% YoY
• Adjusted EBITDA: $416 million, down 17%
• Adjusted EBITDA per tonne: $432, down 18%
• Net sales: $4.7 billion, up 13%, aided by higher average aluminium prices and a 1% increase in rolled product shipments to 963 kilotonnes

The company disclosed a net negative tariff impact of $28 million on adjusted EBITDA for the quarter.

Tariffs and Strategic Response

As per news reports, US President Trump’s 50% tariff on steel and aluminium will pressure costs, the company is pursuing tariff mitigation strategies to protect volumes.

The long-term growth plan includes its under-construction Alabama greenfield rolling and recycling facility, with a planned capacity of 600 kilotonnes.

CFO Dev Ahuja said Novelis is looking to streamline costs amid the challenging external environment, with FY26 capex projected at $1.9–2.2 billion.

Read More: Best Metal Stocks in July 2025: NALCO, NLC India, Hindalco Industries and More - Based on 5-Yr CAGR.

Conclusion

Novelis’ weak earnings and the impact of US tariffs present short-term challenges for Hindalco. However, ongoing capacity expansion and cost-optimisation efforts may provide long-term growth support. Investor focus will remain on tariff developments and operational progress at the Alabama facility.

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