MUMBAI: Hindalco Industries is eyeing an annual operating profit growth of 15-18% from its downstream aluminium business over the next 5 years, a target underpinned by structurally higher demand from the transportation and energy transition sectors."We believe that an upstream-downstream combination for a metals company is the best from a shareholder point of view because it gives you steadiness in income," said Satish Pai, managing director. "There is also additional margin accretion over metal, and better returns because the capital intensity in downstream is much lower," he said.Upstream operations typically involve extraction of raw materials to produce basic metal, the pricing for which is largely dependent on global commodity prices. Downstream operations are a value addition to the basic metal, converting it specifically as per customers' requirements, and has more stable pricing compared to the basic metal."In 2018, we had moved capital allocation to downstream. Now, we are at a stage where we want to take the benefit of these investments," Pai told ET in an exclusive interaction. "Now that the demand for upstream and LME are strong, a large part of our capital will go there," he said.While Hindalco is one of the largest producers of primary aluminium in India, it has also been investing in downstream capabilities over the last few years, and has outlined a capital expenditure plan of $5 billion in India for five years, which includes both upstream and downstream projects.Hindustan Zinc plans Rs 50k-crore capex pipeline for next 5 years"We are hoping to get a better return on investment and steadier earnings profile, but the most attractive part is that we will be the only player for many of these engineered products because of our capabilities," Pai said. The company is also gearing up to substitute imports coming into the country while being an alternative to China as a production base.Vedanta says no penalty, restrictions imposed after ED searchesDemand in the transport space will be driven by the need for lower carbon emitting vehicles, for which the industry will either move to electric vehicles, or have lighter vehicles-both of which have higher usage of aluminium. The storage of energy and batteries, and data centres is seen as another key segment driving demand.Apart from these industrial segments, Hindalco is also targeting growth from value-added services such as Eternia, which currently offers a premium range of windows and doors. The company is targeting a revenue of ?1,000 crore from these by fiscal 2029. Its next offering under 'Eternia' is likely to be modular kitchens made of aluminium.