India’s largest iron-ore manufacturer NMDC today announced its quarterly results and termed the Q1 FY22 results as one of its best Q1 performances since the inception of the enterprise. NMDC reported a whopping 500% y-o-y increase in the consolidated net profit at Rs 3,191.45 crore.
The state-owned mineral-producing company also reported a 423% EBITDA rise at Rs 4,322 crore. NMDC had last week announced that the prices of lump iron ore will be cut by Rs 300/tonne. Although iron ore rates in the international market remain volatile and jittery, NMDC reported a 236% increase in its revenue from operations at Rs 6,512.21 crore.
The company which comes under the ambit of the Steel Ministry of India saw a 34.9% increase in overall production at 89.10 LT in the June 2021 quarter compared to its previous best of 85.27 LT in Q1 FY18. NMDC also reported a meteoric 50.6% hike in sales, the highest in the enterprise’s history.
NMDC’s stock closed in the green at Rs 174.25 after rising by 1.43% at the end of the intra-day trading session ahead of its Q1 FY22 results.
Iron ore sales plummeted q-o-q by 5% from Rs 6,807.44 crore to Rs 6.447.18 crore.
q-o-q iron ore production by 28% from 123 LT to 89.10 LT on account of lockdowns triggered by the second wave.
Other minerals & services
Income from the pellet, other minerals, and services up from Rs 40.13 crore to Rs 65.03 crore q-o-q.
Govt-owned NMDC Ltd. last month initiated the process of separating its steel unit in a demerger. NMDC Steel Ltd has been a subsidiary of NMDC Ltd and currently does not have any business operations. Although the demerger has been given a green signal by NMDC Ltd board of directors, the move still awaits the nod of investors, SEBI, and the Union ministry of corporate affairs.
NMDC has reported a consistent rise in net profit and revenue amid a wobbly iron ore international market. There were reports of NMDC Steel Ltd demerger. A nod for a demerger could point towards divestment of the steel plant. With the NMDC setting up a 3 MTPA integrated steel plant in Chhattisgarh’s Nagamar, analysts expect the demerger to pave the way for value unlocking since the market has not ascribed a value to the steel plant yet.