In a significant development for India’s mining sector, a proposed merger between two major state-owned enterprises has garnered attention. This strategic consolidation, currently under Finance Ministry review, aims to enhance iron ore pellet exports and strengthen the nation’s mineral development capabilities.
Share Price Movement
The share price of NMDC Limited hit an intraday high of 1.81 percent to Rs. 66.08 per share on Tuesday, an increase from its previous close of Rs. 64.90 per share. The market capitalisation now stands at approximately Rs. 57,876 crore as of January 07, 2025.
What’s Driving Share Price?
The Indian Steel Ministry has proposed a merger between two state-owned companies, Kudremukh Iron Ore Company Limited (KIOCL) and National Mineral Development Corporation (NMDC). This proposal has been forwarded to the Finance Ministry for consideration. NMDC aims to export iron ore pellets from KIOCL after the proposed merger.
Financial Highlights
According to its recent filing, in the quarter ending September 2024, NMDC’s consolidated revenue from operations has increased by 22.54 percent YOY from Rs. 4,014 crore in Q2 FY24 to Rs. 4,919 crore in Q2 FY25 and decreased by 9.14 percent QoQ from Rs. 5,414 crore in Q4 FY24.
The company’s consolidated net profit has increased by 22.54 percent YoY, from Rs. 1,026 crore in Q2 FY24 to Rs. 1,205 crore in Q2 FY25. As compared to the last quarter of 2025, the company’s net profit has decreased by 9.14 percent QoQ from Rs. 1,969 crore.
The average price-to-earnings (P/E) ratio in the telecom-service industry is 20.12. which is less than NMDC’s current P/E ratio of 9.24.
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Market Outlook
The global crude steel production saw a slight increase of 0.4% in 2023, with China leading at 54%. While China’s output remained flat due to carbon reduction efforts, India’s production rose by 12%. In 2024, steel demand is expected to grow by 1.9%, with the construction and machinery sectors leading. By 2030, the market could reach 1.98–2.3 billion metric tonnes. The steel industry is shifting towards more sustainable methods, with a focus on energy-efficient and eco-friendly production techniques.
Shareholding Pattern
As of the September 2024 shareholding pattern, NMDC Limited is primarily held by the promoters at 60.79 percent, foreign institutional investors hold 12.60 percent, and the public with 12.52 percent.
About Company
NMDC Limited, established in 1958 and headquartered in Hyderabad, Telangana, is a major player in India’s mining sector, operating under the Ministry of Steel. It is the largest producer and exporter of iron ore in India, with over 45 million tonnes of annual production, and also produces copper, limestone, and diamonds. Key mining projects include the Bailadila Iron Ore Mine in Chhattisgarh and the Panna Diamond Mine in Madhya Pradesh.
NMDC is also diversifying into steel production with the Nagarnar Steel Plant in Chhattisgarh. Looking ahead, NMDC is expanding through international ventures in Australia and Africa, and with the establishment of NMDC Steel Limited in 2022, it is strengthening its role in steel production.
Written By Fazal Ul Vahab C H
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