NMDC Ltd Q4 FY2026 Concall Summary

Key Takeaways

• Volume-led growth, margin steady: Production crossed 5.3 crore tons and PAT grew 11% in FY26, while standalone iron ore EBITDA held at 42% despite a consolidated EBITDA dip from steel trading.
• The 10-crore-ton build-out is now underway: Board sanctioned a ₹3,000 crore Vizag blending yard and management will award ₹15,000–₹20,000 crore of tenders within two months, committing ₹40,000–₹50,000 crore over three years to hit the target by decade-end.
• New minerals are becoming material: Coal revenue is guided to reach ₹5,000–₹8,000 crore within three years, a rare earth subsidiary is formed, and management is in advanced stages of acquiring assets abroad.
• Operational milestones are stacking up: All mines touched EC capacity for the first time, production cost fell to ~₹800/ton, and the slurry pipeline plus pellet plant will commission by mid-July.
• What to watch next quarter: Whether Deposit 4 and Deposit 13 begin commercial mining on schedule, the pace of tender awards for the ₹40,000–₹50,000 crore capex plan, and any announcement on global acquisitions.

Volume Growth & the 10-Crore-Ton Pathway

• FY27 target: Management is confident of reaching 6 crore tons this year, with production already 15% higher in the first two months versus last year and Q1 crossing 0.5 crore tons in a single month for the first time.
• New mines coming online: Deposit 4 (0.7 crore ton peak) starts commercial mining in July, contributing ~0.1 crore ton this year; Deposit 13 begins around Q2 with ~0.05 crore ton this year, ramping to 2.0–2.1 crore ton in 4–5 years.
• Existing mine expansion: Kirandul moves from 2.1 to 3 crore tons, Bacheli from 1.8–1.9 to 3.5 crore tons by decade-end; Kumaraswamy stays stable at 1.7 crore tons due to regulatory limits.
• Infrastructure unlocking volume: The Bhansi–Bacheli railway doubling completes by December, lifting evacuation capacity to ~4 crore tons immediately and eventually 5–6 crore tons; new infrastructure for Deposit 14, 14 NMZ, 11 and 11C takes another 1.5 years, after which production capacity increases substantially by 0.5–0.6 crore ton.
• Demand is not the constraint: Large customers (JSW, AMNS, JSPL, NSL, Vizag) have substantial expansion plans, and NMDC's ore carries 0.05 phosphorus, a quality no other Indian producer matches, making it an essential blend component even if customers reach full capacity.

Mukherjee: "Our phosphorus content is 0.05. No one else in India has that. So you will always need my ore as a blend even if you have full capacity."

Capex & the Blending Yard

• Spend trajectory: FY27 capex is guided at ~₹6,000 crore, rising to ₹7,000–₹10,000 crore annually over the next 2–3 years; major tenders worth ₹15,000–₹20,000 crore will be awarded by end of this month or next month, and the company needs to spend ₹40,000–₹50,000 crore within three years to reach 10 crore tons.
• Vizag blending yard: The board sanctioned ₹3,000 crore for a blending yard at Vizag, to be completed in ~2–2.5 years, producing India's first branded iron ore of consistent quality; management expects a substantial premium and calls it a game changer for both the company and the country.
• Slurry pipeline and pellet plant: The 1.5 crore ton slurry pipeline from Bacheli to Nagarnar, the pellet plant at Nagarnar, and the grinding mill at Bacheli are mechanically complete and in pre-commissioning trials; commissioning is expected by month-end or mid-July.
• Funding stance: No immediate plans to leverage the balance sheet; internal resources should service all capex and acquisition requirements, with debt considered only if certain big-ticket global acquisitions materialize.

Mukherjee: "India has never tasted that. So NMDC would be the first company in 3 years' time will be selling branded iron ore and board has already sanctioned an investment proposal for INR3,000 crores approximately for making a blending yard at Vizag where we will be making this blended iron ore of a consistent quality which India has never seen."

Coal & New Minerals

• Coal becoming a material business: Management guided coal top-line sales of not less than ₹5,000–₹8,000 crore within three years, driven by two mines.
• Tokisud thermal coal mine: Opened in Jharkhand, giving NMDC a new mineral and geography; production begins this month (June 2026) with ~0.08–0.1 crore ton this year, ramping to a peak rated capacity of 0.23 crore ton within 1.5–2 years.
• Rohne coking coal mine: Operations start by end of Q3 FY27, with peak rated capacity of 0.8 crore ton; no commercial production this year due to overburden removal, but ramp-up to peak is expected within 1.5–2 years.
• Rare earth and critical minerals: A dedicated rare earth subsidiary has been opened; an MOU with Gujarat Mineral Development Corporation covers joint development of a rare earth mine and processing facilities in Gujarat, with talks at an advanced level to get operational as fast as possible.
• Global acquisitions: Management hopes to acquire a couple of assets abroad this year and is in very advanced stages, though details remain confidential; critical minerals capex on acquisitions is pegged at ~₹2,000–₹3,000 crore this year.

Mukherjee: "We know that rare earth and other critical minerals are the future and as a mining company and as a national mining company and as an all-mineral company, National Mineral Development Corporation, we realize that these have to form a very important and a substantial part of our mining portfolio."

Realizations, Margins & Costs

• Standalone margin intact: Iron ore standalone EBITDA held at 42%; the consolidated EBITDA decline from 42% to 33% was entirely due to the steel trading business, which management says was not required this quarter and will be used very rarely this financial year, if at all.
• FY27 margin expectation: Management expects to maintain EBITDA margin at around 42–43% this year, with prices seen as fairly range-bound and no sharp increase anticipated.
• Production cost improvement: Bailadila production cost was brought down from ~₹1,000 per ton to around ₹800 per ton this year; further efficiency gains are expected to offset the impact of wage revisions.
• Pricing mechanics: Realizations depend on multiple variables including steel prices, international prices, competitor prices, demand appetite and logistics; management declined to quantify a lag, stating there is no absolute or proportionate link to steel prices.
• Wage revision impact: Non-executive pay revision is under ministry consideration with increased wages already provided for from 1 January 2026; executive provisions (about 1,100 employees) apply from 1 January 2027; the impact is described as not very substantial and will be offset by efficiency gains, though no specific number was given.

Customer & Competitive Position

• RINL relationship is structural: NMDC cannot afford to curtail supplies to RINL because doing so would immediately affect its own production; the bill discounting arrangement runs on a 45-day lag with RINL paying ~10% extra and honoring 100% of discounted bills, with no recourse to NMDC last year or this year.
• NSL turnaround: NSL has become profitable with operational aspects mostly solved; management expects much greater profits this year, and the entire outstanding receivable should be liquidated within 16–18 months.
• EC capacity milestone: In FY26, all NMDC mines touched EC capacity except Deposit 5 (which received its enhancement late); as of 1 April, all mines touched EC capacity, a first for any iron ore company in India.
• KIOCL pellet progress: KIOCL achieved 66.5% FE pellet and sold a couple of consignments; it is targeting DR grade at 67% FE, which would be a first in India, with greater clarity expected by Q2; the current DR grade premium is $20–$30 per ton.
• Exports remain off the table: With a 30% export duty, iron ore exports do not make economic sense; if NMDC exports, it should be pellets.

Mukherjee: "That is one company we cannot afford not to supply because that will immediately affect our production if supplies there are constrained. So it is neither in our interest to curtail the supplies nor in their interest to have lesser supplies."

Guidance & Commitments

Key Metrics