NALCO posts a remarkable 101.5% surge in Q4 net profit supported by record-high sales and lower expenses

On Monday, May 27, National Aluminium Company Limited (NALCO), a state-owned Navratna CPSE under the Ministry of Mines, announced strong fiscal results for the fourth quarter and full year of FY2023-24, driven by a robust growth trajectory in production and sales. 

NALCO reported that its Q4 net profit recorded a two-fold jump of 101.5 per cent year-on-year, reaching INR 996.7 crore, surpassing the CNBC-TV18 poll’s prediction of INR 605 crore. During the corresponding quarter of the last financial year, NALCO’s net profit was INR 495 crore. 

However, the company’s revenue from operations dipped 2.5 per cent Y-o-Y in Q4 FY2024, amounting to INR 3,579 crore versus INR 3,671 crore, attributing to the lower benchmark prices of aluminium on the London Metal Exchange. The three-month aluminium contract on LME averaged $2,241 per tonne during January-March 2024, down 8.2 per cent from the same period of the previous year.

Despite the revenue decline, NALCO’s net profit increased during the said period, backed by expenses dropping to INR 2,720.42 crore from INR 3,160.50 crore a year ago. Record-high sales of 470,108 tonnes during FY2024 also contributed to the rise in net profit. 

The expenses could be kept in check due to a 22 per cent decline in raw material costs, including thermal coal and bauxite – the two primary inputs for aluminium production. 

At the operating level, EBITDA jumped 44.5 per cent Y-o-Y in Q4 FY2024 from INR 766 crore to INR 1,107.50 crore. That even exceeded the market prediction of INR 945 crore for the quarter under review. 

The EBITDA margin stood at 30 per cent in Q4 FY2024 versus 20 per cent a year earlier. 

As soon as NALCO announced its results, shares grew by INR 1.10 or 0.57 per cent on the BSE to INR 194.25.