National Aluminium Company Ltd (NALCO), a Navratna PSU under the Ministry of Mines, has been a key player in India’s aluminium industry since 1981. Headquartered in Bhubaneswar, it operates an integrated value chain spanning bauxite mining, alumina refining, aluminium smelting, and captive power generation. The Government of India holds a 51.28% stake, highlighting its strategic significance. NALCO’s backward-integrated operations, from the Panchapatmali mines to its Damanjodi refinery and Angul smelter ensure cost efficiency and supply stability. The company also maintains a strong domestic and export presence through its nationwide network and in-house bulk export infrastructure.
| CMP (Rs) | Target (Rs) | Upside |
|---|---|---|
| ₹224 | ₹280 | 25% |
| Key Data | Value |
|---|---|
| Bloomberg Code | NACL IN |
| Curr Shares O/S (mn)* | 1836.6 |
| Mkt Cap (Rsbn/USDmn) | 411.9/4644 |
| 52 Wk H / L (Rs)* | 263/138 |
| 5 Year H / L (Rs)* | 263/29 |
| Daily Vol. 3M Avg. (‘000) | 8760.4 |
Source: NSE, ACE Equity, MNCL Research
| % | 1M | 6M | 1Yr |
|---|---|---|---|
| NATIONALUM | 7.3 | 56.4 | 5.4 |
| NIFTY | 1.3 | 12.9 | 1.1 |
Source: ACE Equity, MNCL Research
| % | Jun-25 | Mar-25 | Dec-24 |
|---|---|---|---|
| Promoter | 51.3 | 51.3 | 51.3 |
| Inst./Govt. | 30.8 | 31.5 | 32.1 |
| Others | 17.9 | 17.2 | 16.6 |
Source: ACE Equity, MNCL Research
NALCO is set for a major volume-led transformation with its 1,000 ktpa brownfield expansion at the Damanjodi alumina refinery, now over 75% complete and targeted for commissioning by April 2026. The new stream will raise refining capacity by ~50% to 3,100 ktpa (NALCO’s biggest capacity addition in a decade). Since smelting capacity remains unchanged at 460 ktpa, incremental alumina will be sold in the merchant market, benefiting from higher export realizations. Alumina production and sales volumes are projected to grow at a CAGR of 14% and 25% (FY25–28E), respectively.
NALCO’s integrated raw material strategy is to strenghten cost efficiency across its alumina and aluminium operations. The Utkal-D and Utkal-E coal blocks (4.0 mtpa) are easing reliance on expensive e-auction coal, lowering captive power and smelting costs. Parallel development of the Pottangi bauxite mines (3.5 mtpa) will align with the 5th refinery stream, ensuring long-term ore security and reduced dependence on Panchpatmali mines. While mine lease expires in 2029–2032 pose renewal risks, proactive action is expected to ensure continuity. Collectively, these backward linkages reinforce NALCO’s cost leadership, margin stability, and resilience amid global volatility.
NALCO remains in net cash (Rs53bn) as of FY25, supported by robust free cash flows and margins above 35%. This healthy balance sheet enables self-funded growth, including a planned 500 ktpa aluminium smelter expansion (~₹170bn capex) targeted by CY30–31. With an annual capex of ₹17–20bn largely met through internal accruals, the company can pursue both brownfield and greenfield projects without much leverage. We expect stable long-term price outlooks for aluminium and alumina due to cap on new greenfield alumina & aluminium capacities both in China and Australia.
We value the company at 8x FY27 EV/EBITDA, arriving at a target price of Rs 280.
| Y/E Mar (Rs mn) | FY24 | FY25 | FY26E | FY27E | FY28E |
|---|---|---|---|---|---|
| Sales | 1,41,709 | 1,30,701 | 1,66,622 | 1,49,396 | 1,61,432 |
| YoY (%) | 0.8 | -7.8 | 27.5 | -10.3 | 8.1 |
| EBIDTA | 24,616 | 28,904 | 75,837 | 54,498 | 57,285 |
| YoY (%) | -46.2 | 17.3 | 163.3 | -28.0 | 5.1 |
| PAT | 14,347 | 19,885 | 52,679 | 41,261 | 41,450 |
| YoY (%) | -51.4 | 38.6 | 164.9 | -21.7 | 0.5 |
| EPS (Rs) | 7.8 | 10.8 | 28.7 | 20.4 | 21.7 |
| Y/E Mar | FY24 | FY25 | FY26E | FY27E | FY28E |
|---|---|---|---|---|---|
| EBIDTAM (%) | 17.4 | 22.1 | 45.5 | 36.5 | 35.5 |
| NPM (%) | 10.1 | 15.2 | 31.6 | 27.6 | 25.7 |
| PER (x) | 9.1 | 17.3 | 6.9 | 10.8 | 10.1 |
| EV/ EBITDA (x) | 5.5 | 9.4 | 4.7 | 6.2 | 5.8 |
| RoE (%) | 11.2 | 14.5 | 32.7 | 18.8 | 17.8 |
| RoIC (%) | 9.9 | 10.6 | 29.7 | 17.5 | 17.0 |
| Pre-Tax OCF/EBITDA (%) | 67.2 | 116.3 | 99.2 | 85.4 | 85.2 |
Source: Company NALCO Ltd, MNCL Research
| Stock Details | Industry | Buying Range (₹) | CMP* (₹) | Target Price (₹) | Upside Potential % |
|---|---|---|---|---|---|
| Bharat Electronics Ltd | Defence | 407-420 | 414 | 463 | 12% |
| Brigade Enterprises Ltd | Real-estate | 920-970 | 943 | 1341 | 42% |
| Clean Science & Technology Ltd | Specialty Chemical | 1045-1100 | 1072 | 1220 | 14% |
| Elecon Engineering Company Ltd | Capital Goods | 540-580 | 557 | 733 | 32% |
| ICICI Bank Ltd | BFSI | 1360-1400 | 1380 | 1700 | 23% |
| National Aluminium Company Ltd | Metals | 215-235 | 224 | 280 | 25% |
| Sai Life Sciences Ltd | Healthcare | 840-885 | 861 | 1055 | 22% |
| TBO Tek Ltd | Hospitality | 1520-1600 | 1562 | 1853 | 19% |
| TCPL Packaging Ltd | Packaging | 3300-3500 | 3402 | 4303 | 26% |
| Vesuvius India Ltd | Metals | 490-520 | 505 | 585 | 16% |
| Windlas Biotech Ltd | Healthcare | 890-940 | 915 | 1225 | 34% |
*Closing Price as on 10-10-2025
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Monarch Networth Capital Limited (‘MNCL’) | CIN No.: L64990GJ1993PLC120014
Unit No. 803-804A, 8th Floor, X-Change Plaza, Block No. 53, Zone 5, Road-5E, Gift City, Gandhinagar - 382050, Gujarat
Ahmedabad
“Monarch House”, Opp Prahladbhai Patel garden, Near Ishwar Bhuvan, Commerce Six Roads, Navrangpura, Ahmedabad - 380009
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Monarch Networth Capital Limited, G Block, Laxmi Tower, B Wing, 4th Floor, Bandra Kurla Complex, Bandra East, Mumbai - 400051.
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Monarch Networth Capital Limited (‘MNCL’) | CIN No.: L64990GJ1993PLC120014
(As per LODR Regulations and Companies Act, 2013)
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Monarch Networth Capital Limited
Unit No. 803-804A, 8th Floor, X-Change Plaza, Block No. 53, Zone 5, Road-5E, Gift City, Gandhinagar - 382050, Gujarat
Ahmedabad
“Monarch House”, Opp Prahladbhai Patel garden, Near Ishwar Bhuvan, Commerce Six Roads, Navrangpura, Ahmedabad – 380009
Mumbai
Monarch Networth Capital Limited, G Block, Laxmi Tower, B Wing, 4th Floor, Bandra Kurla Complex, Bandra East, Mumbai - 400051.
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