The high price of coal will adversely impact the profitability of domestic non-ferrous metal companies mainly operating in the aluminium and zinc space, Icra said on Monday.
The domestic e-auction premium on coal, though it has softened in recent months, continues to remain high at around 300 per cent.
“In the domestic market, power costs have significantly increased for domestic base metal companies, owing to the lower availability of coal linkages to non-power sectors and elevated coal prices in both domestic e-auction and the international markets,” Icra said in a statement.
Besides, the price of alumina decreased along with the price of aluminium, giving some respite to the non-integrated players.