India: NMDC posts rise in production, sales y-o-y in Q1FY24

NMDC, India's largest iron ore producer, recently announced its Q1FY'24 (April-June, 2023) results. Notably, the company reported its best-ever Q1 production and sales figures in the preceding quarter.

Performance highlights:

• Iron ore production up by 20% y-o-y: The miner recorded iron ore output at 10.7 million tonnes (mnt) in Q1FY24 as against 8.92 mnt in Q1FY23.
  
  
• Iron ore sales rise by 41% y-o-y: NMDC's total iron ore sales increased by 41% y-o-y to 10.9 mnt in the period under review compared to 7.8 mnt in Q1FY23. The entire quantity of 10.9 mnt was sold in the domestic market.
  
  
• Average sales realisation falls: The miner's average sales realisation stood at INR 4,850/tonne (t) in Q1FY24, a fall of 20% y-o-y from INR 6,050/t in Q1FY23.
  
  
• PAT edges up 12% y-o-y: NMDC's profit after tax (PAT) increased by 12% y-o-y to INR 1,650 crore in Q1FY24 compared to INR 1,473 crore in the same period last year.
  
  

Highlights of the investors' call:

• Production guidance remains unchanged: Expected production in FY24 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.
  
  
• Commissioning of Nagarnar steel plant: The Nagarnar Integrated Steel Plant recently witnessed commissioning of its blast furnace (BF) on 12 August 2023. However, full-fledged commissioning will take place by 21-23 August after silica level goes below 1%, officials highlighted.
  
  
• Commissioning of coal blocks by next FY: The process of land acquisition has been completed for coal blocks and application has been submitted to the Ministry of Coal. Post-clearances, the mines would be commissioned by next financial year.