NALCO Reports Record FY26 Profit, Launches Major Expansion Plans

National Aluminium Company (NALCO) reported strong financial results for fiscal year 2026. The company achieved a record revenue of Rs. 17,843 crore, a 6.28% increase year-on-year. Profit After Tax (PAT) reached a new peak, growing 9.22% to Rs. 5,816 crore. This performance was driven by record physical output in bauxite, alumina, metal, and power generation. While alumina prices dipped to $370 per tonne, higher metal prices, reaching $2,700 per tonne, boosted results. Savings in key materials like caustic soda and furnace oil also contributed to the strong profit.

These record profits highlight NALCO's ability to perform well in strong aluminium markets and its focus on operational efficiency and securing raw materials. The results provide a solid base for the company's expansion plans aimed at increasing production capacity.

NALCO, a 'Navratna' company under India's Ministry of Mines, is one of the country's largest integrated aluminium producers. Its operations span bauxite mining, alumina refining, aluminium smelting, and power generation. The company is increasing its captive coal output from the Utkal mine for power plant security and is exploring new areas like Gallium and rare earth elements.

NALCO has detailed significant expansion plans. The fifth stream of its Alumina Refinery is due to commission in June 2026, adding 2 lakh tons of capacity for FY27. A major new 0.5 million ton smelter is planned for completion by late 2030 or early 2031. To support these efforts, captive coal output from Utkal mines is expected to reach 4.8 million tons in FY27, enhancing supply security. Additionally, a new 50-50 joint venture with Neyveli Lignite for a power plant will share capital expenditure, reducing NALCO's financial burden for this project.

However, NALCO faces several near-term risks. Alumina spot prices are currently near their bottom ($300-$310 per tonne) due to oversupply. The company is also navigating geopolitical issues impacting export logistics. Rising costs for key inputs like caustic soda and furnace oil could pressure margins. While typically minor, the company has also faced past fines for regulatory compliance issues related to board appointments.

NALCO's main Indian competitors are Hindalco Industries and Vedanta Ltd. For FY23, Hindalco reported a consolidated PAT of Rs. 1,971 crore, while Vedanta Aluminium produced 2.26 million tonnes. NALCO's integrated operations and government backing offer a stable foundation.

For FY26, NALCO reported record standalone revenue of Rs. 17,843 crore and PAT of Rs. 5,816 crore. Q4 FY26 alumina realization was $348 per tonne, with Q1 FY27 trending lower at $320. Metal realization in Q4 FY26 was $2,700 per tonne, with an outlook for an average of $3,000 LME. Investors will monitor the commissioning of the fifth alumina refinery stream in June 2026, progress on the new smelter project, and management's views on metal prices. Tracking coal production targets, raw material cost impacts, and developments in Gallium and rare earth elements projects will also be key.