National Aluminium Company (NALCO) reported an 81% year-on-year rise in EBITDA, supported by strong aluminum prices and cost control. Despite this, the company delayed the commissioning of its new 1-million-tonne alumina refinery to late 2026. Investors should track production timelines and volatile aluminum prices as key factors for future earnings.
National Aluminium Company (NALCO) has reported a strong operational performance for the recent quarter, highlighted by an 81% jump in its earnings before interest, taxes, depreciation, and amortization (EBITDA) compared to the same period last year. This growth was primarily driven by higher aluminum prices in the global market, alongside disciplined control over internal manufacturing and employee costs.
Operational Highlights and Expansion Delays
The company’s operational data shows that alumina production volumes rose by 14% year-on-year, while metal output remained steady. However, a significant update for shareholders is the revision in the timeline for the new 1-million-tonne-per-annum alumina refinery. The commissioning of this project has been deferred by one quarter, with expectations now set for the end of September 2026 and commercial production planned for the final months of the year.
While the company has successfully managed costs, management expects continued pressure from rising input prices in the second quarter. The net selling realization for aluminum improved by 12% quarter-on-quarter, reaching $3,918 per tonne, bolstered by premiums over the London Metal Exchange (LME) prices. Meanwhile, alumina prices saw a 7% decline on a quarter-on-quarter basis, settling at $330 per tonne.
Investor Context and Market Outlook
Financial analysts have recently updated their outlook on the company, adjusting EBITDA estimates for FY27 and FY28 upward by 5% and 6%, respectively. These projections are based on assumptions of sustained higher LME aluminum prices and the impact of a weakened Indian Rupee, which typically benefits domestic commodity exporters. Market data indicates the stock is currently trading at an Enterprise Value to FY28 estimated EBITDA multiple of 4.6x.
For investors, the primary monitorables remain the successful execution of the delayed refinery project and the volatility of global aluminum prices, which significantly influence profit margins. Because aluminum prices are subject to global cyclical trends, any sudden correction in LME prices could dampen future earnings. Furthermore, keeping an eye on whether the company can maintain its cost-efficiency as raw material inflation persists will be essential for assessing long-term profitability.