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Novelis Delays IPO

Novelis Postpones $945 Million IPO Amid Adverse Market Conditions

Posted on June 14, 2024
Writer: James Miller

Aluminum producer Novelis Inc. delayed its plan to raise up to $945 million in an initial public offering (IPO), citing adverse market conditions. 

The postponement comes amid broader market turmoil, including India’s stock market instability following Prime Minister Narendra Modi’s party losing its parliamentary majority.

Novelis, a unit of Hindalco Industries Ltd., is undergoing a decade-long expansion drive to increase production capacity. It is known as the world’s largest aluminum recycler and, with operations across continents, is a major producer of flat-rolled aluminum products used in various industries.

The delay in the IPO follows Novelis’ confidential filing for the listing with regulators earlier this year. The company planned to offer 45 million shares at a price range of $18 to $21 per share, with Hindalco retaining majority ownership post-IPO.

The decision to postpone the IPO raised concerns among analysts, with some speculating on Hindalco’s internal financial strategies. However, despite a slight dip in net income, Novelis reported substantial net sales in the previous fiscal year, a testament to the company’s resilience in the face of challenging market conditions.

Although competitors like Norsk Hydro ASA and Alcoa Corp. have also faced earnings challenges, aluminum prices recovered notably since February. 

For more insights, read the full article on Yahoo! Finance.

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