India: NMDC posts best-ever production, sales performance in H1FY'24

NMDC, India's largest iron ore producer, recently announced its H1FY'24 (April-September, 2023) results. The company reported its best-ever iron ore production and sales volumes in the period under review.

Notably, the mining major reported its best-ever second-quarter iron ore production and sales, too, in Q2FY'24 (July-September, 2023) at 8.85 million tonnes (mnt) and 9.57 mnt, respectively.

Performance highlights:

• Iron ore production is up over 20% y-o-y: The miner recorded iron ore output at 19.5 mnt in H1FY'24 as against 16 mnt in H1FY'23.
  
  
• Iron ore sales rise by 27% y-o-y: NMDC's total iron ore sales increased by 27% y-o-y to 20.5 mnt in the period under review compared to 16.2 mnt in H1FY'23.
  
  
• Average sales realisation drops y-o-y: The miner's average sales realisation stood at INR 4,522/tonne (t) in H1FY'24, a decrease of 8% y-o-y from INR 4,928/t in H1FY'23.
  
  
• EBIDTA increases y-o-y: The company's EBIDTA was recorded at INR 3,790 crore in H1FY'24, an increase of 14% y-o-y as against INR 3,326 crore in the corresponding period last year (CPLY).
  
  
• PAT edges up 13% y-o-y: NMDC's profit after tax (PAT) increased by 13% y-o-y to INR 2,678 crore in H1FY'24 compared to INR 2,362 crore in the year-ago period.
  
  

Highlights of investors' call:

• Production guidance remains unchanged: Expected production in FY'24 will be around 50 mnt which is expected to be achieved through enhancement of Kumaraswamy mines in Karnataka to 10 mnt from the current 7 mnt. Notably, the respective mines have a scalability of around 25-30 mnt, officials highlighted.
  
  
• Commissioning of Nagarnar steel plant: The Nagarnar Integrated Steel Plant witnessed commissioning of its blast furnace (BF) on 12 August 2023. However, full-fledged commissioning will take place by next financial year (FY).
  
  
• Commissioning of diamond mines: The miner has received clearances from the Supreme Court (SC) and Environmental Clearance (EC) is in process for a diamond mine. As per the officials, the respective mine has a production capacity of around 30,000 carats per year. However, they will try to achieve 10,000 carats of production in the initial years of mining.