NALCO records strong Q1 profit growth, revenue dips 10%

The Indian State-owned integrated aluminium company NALCO has reported a substantial 76 per cent increase in its first-quarter (APR-JUN FY25) profit, reflecting the impact of higher aluminium prices and reduced costs.

For the quarter ending June 30, the state-owned firm's consolidated profit surged to INR 588.42 crore (approximately $70 million), up from the previous year's figures.

The boost in profit comes as global prices for base metals, including aluminium, have climbed sharply during the quarter due to supply concerns and increased demand. This uptick in commodity prices generally leads to higher selling prices for metals, enhancing miners' profit margins.

According to an exchange filing, Nalco reported a consolidated profit of INR 333.76 crore for the same period last year. However, the company's consolidated income for the April-June quarter declined to INR 2,916.62 crore, compared to INR 3,226.88 crore in the corresponding period of the previous year.

In May 2024, NALCO reported a two-fold increase in its Q4 FY24 net profit, soaring by 101.5 per cent year-on-year to INR 996.7 crore. This compares to a net profit of INR 495 crore in the same quarter of the previous financial year.

However, the company experienced a slight decline in revenue from operations, which fell by 2.5 per cent year-on-year in Q4 FY2024 to INR 3,579 crore, down from INR 3,671 crore. This decrease was primarily due to lower aluminium benchmark prices on the London Metal Exchange.

In FY 2024, the company achieved record-breaking milestones across various sectors. It produced an unprecedented 0.46 million tonnes of cast metal, excavated 7.6 million tonnes of bauxite, and recorded its highest-ever metal sales at 0.47 million tonnes, surpassing all previous benchmarks since its inception.

During this period, the company expanded its product portfolio by introducing a new aluminium alloy ingot, AL59. The alumina refinery reached a remarkable 100 per cent capacity utilisations, producing 2.12 million tonnes of alumina hydrate. Meanwhile, the Captive Power Plant (CPP) generated an impressive 7,193.62 million power units.

Additionally, FY 2024 marked the development and operationalisation of the Utkal D coal block, with the company producing 2 million tonnes of coal, achieving the mine’s peak-rated capacity.

Despite the revenue dip, NALCO's net profit surged during the period, supported by a reduction in expenses to INR 2,720.42 crore from INR 3,160.50 crore a year ago. Additionally, record-high sales of 0.47 million tonnes during FY2024 contributed to robust profit growth.