India’s largest iron ore producer, NMDC, registered a noticeable third-quarter performance in Q3FY’22 (Oct-Dec’21). The company reported its best-ever iron ore production in this quarter.
Highlights of the investors’ call
- Iron ore production up 11% y-o-y: The miner recorded iron ore output at 10.65 million tonnes (mnt) in Q3FY’22 as against 9.60 mnt in Q3FY’21. Meanwhile, on a quarterly basis, output rose by 21% as compared to 8.77 mn t in Q2FY’22.
- Iron ore sales up 6% y-o-y: NMDC’s total iron ore sales volumes increased 6% y-o-y to 9.84 mnt in Q3FY’22 when compared to 9.28 mnt in Q3FY’21. Also, sales increased by 10% q-o-q as against 8.98 mn t in Q2FY’22. The entire quantity of 9.84 mnt was sold in the domestic market.
- EBIDTA down y-o-y: The company’s EBIDTA was recorded at INR 2,765 crores in Q3FY’22, down significantly as against INR 2,873 crores in Q3FY’21.
- Production guidance unchanged: Expected production in FY’22 will be around 43-45 mnt, remaining unchanged.
- Nagarnar pellet plant commissioning: The 2-mnt pellet plant will be set up as a part of NMDC’s slurry pipeline project and the contract has already been awarded to L&T. The commissioning of the plant is expected in 3 years.
- Nagarnar steel plant commissioning and demerger: Commissioning of the 3 mnt Nagarnar steel plant has kick-started with the heating of the coke oven and steel operations commencement is expected to be completed by Jul’22. MECON has been awarded the operations and maintenance contract for the plant and required iron ore will be supplied from NMDC’s Bailadila mines. Meanwhile, the demerger of the Nagarnar steel plant is also on schedule with the proposal already filed to the Ministry of Corporate Affairs (MCA). The process is expected to be completed by end-March or early Apr’22.
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