NMDC Steel Ltd has reported a turnaround in FY 2025-26, shifting from a net loss to a profit of Rs 58.72 crore. Revenue jumped 60% year-on-year to Rs 13,641.81 crore, supported by a significant increase in production volumes. Despite this financial recovery, the company continues to face governance hurdles, including a lack of independent directors and ongoing regulatory compliance issues.
NMDC Steel Turns Profitable in FY 2025-26
Revenue rose to Rs 13,641.81 crore from Rs 8,503.05 crore last year.
Net profit reached Rs 58.72 crore, marking a turnaround from the previous loss of Rs 2,373.78 crore.
Reader Takeaway: Strong operational growth drove a return to profitability, though governance gaps and regulatory penalties remain key investor concerns.
What just happened
NMDC Steel has reported its financial results for the full year 2025-26, showing a major recovery. The company achieved an EBITDA of Rs 1,604.44 crore, compared to a negative EBITDA of Rs 1,716.89 crore in the prior fiscal. This performance was backed by a sharp rise in output, with hot rolled coil production increasing to 23.24 lakh tonnes from 14.39 lakh tonnes.
Why this matters
The shift to profit confirms that the firm’s Nagarnar steel plant is successfully scaling. By moving from stabilization to profitability, the management has demonstrated an ability to turn capacity into revenue. However, the operational success is tempered by persistent governance issues.
Governance and Regulatory Hurdles
The company operated throughout the year without any independent directors. Consequently, mandatory board-level committees—such as the Audit and Risk Management committees—could not be properly constituted. Additionally, the company incurred fines from stock exchanges for failing to meet board composition norms and a Rs 1.01 crore penalty from the Chhattisgarh Environment Conservation Board related to wastewater infrastructure.
Auditor and Compliance Observations
Statutory auditors highlighted that the accounting software's audit trail feature was not fully enabled at the database level. Furthermore, the Comptroller and Auditor General (C&AG) raised concerns regarding the non-recognition of Expected Credit Loss on trade receivables and a Rs 9.60 crore provision for land charges, which the company currently disputes.
What to track next
Investors should monitor the Ministry of Steel’s progress on appointing independent directors, which is critical for corporate governance. Additionally, watching the company’s ability to resolve ongoing regulatory compliance matters will be important to avoid future financial penalties.