National Aluminium Company Limited Transcripts of the Earnings Conference Call held on 08.08.2025

NALCO is a Navratna CPSE with Govt. of India holding is 51.28%.
It represents bauxite, alumina, aluminium power core complex in the country, and it is a global leader in producing bauxite and alumina at the lowest cost.
The lowest cost producer since about seven to eight years.

Have been continuously rated as the lowest cost producer in bauxite and alumina.

It's 7.5 million we are producing right now bauxite as per the requirement of refinery.

Refinery capacity is currently 2.1 million ton.
Smelter and CPP assets are at Angul, again in the State of Odisha.
Also recently started operating Utkal D&E Coal Mines in January of 2025.
Combined capacity of 4 million ton started.
Have a dedicated facility at Vizag Port for export of alumina and metal and import of products.
Having four wind power plants of total 198 MW capacity in Rajasthan, Maharashtra and Andhra Pradesh.
As far as US tariffs are concerned, again, that is a concern area.

US tariff increased to around 50% from 25%.
"But our aluminium, which is especially from Nalco, we are not exporting any of the aluminium as of now. We are most, all aluminium is getting consumed in the domestic market. So, Nalco will not be affected by that"

Integrated with own bauxite mines, own aluminum refining capacity, own power plant, then also own captive coal blocks.
The company is a zero‐debt company which gives leverage to all upcoming projects, smelter and power projects, which will require a huge investment.
So the zero‐debt position will help the company to fund itself.
Also having raw material security in case of caustic soda.

Refinery capacity is going ahead. The smelter capacity also is from the pre‐project stages at the moment.
Potential plants currently going ahead, the bauxite mines, are currently running at 7.5 million tons.
Already signed the lease deed for Pottangi bauxite mines, which will be operated by this year‐end or by quarter one of next year.
So, capacity will increase by 3.5 million tons. Then we are going ahead with our 5th stream refinery expansion, which will increase the capacity by 1 million tons.
The mechanical completion is targeted by this financial year end.
And the execution is currently on fast‐track mode.
Reaching around 74% to 75% progress, physical progress, in this refinery expansion.

For aluminum smelter and captive power plant, these are at the pre‐project stages.
And the plants are likely to come, by financial year 2030.

Now coming to physical performance in Q1

Have been operating at almost about 100% capacity, but still are improving productivity and still registering higher production quarter by quarter.
In case of Bauxite, achieved 6.6% growth against corresponding quarter last year.
In case of Alumina Hydrate, there has been a significant jump of 35% against Q1 due to base effect.
Then in case of metal, achieved 3% growth and power also 6% growth.
In case of Alumina, achieved significant jump. This is partly due to base effect as Q1 sales were a little bit less.
And in case of metal also, have achieved growth of 9%.
In case of domestic sales of metal and alumina, in both cases have achieved highest ever sales for Q1 of any particular year.
Exceeding past year productions.

In the last quarter, the Q4 of 24‐25 it was a record breaking performance of the company in the last quarter and the last financial year as well.
In Q1 also, the company has shown very strong performance in its results.
There is growth of 33% in the revenue and also the PAT has registered growth of 77% against the corresponding quarter of last year.
The company has also recommended Final dividend of Rs.2.50 per share in its last Board meeting.
Total production volume guidance for this year

Last year, Calcined Alumina done around 20.7 lakh tons, this year have planned for 22.5 lakh tons.
We'll be achieving around 23. Maybe around two or two and a half lakh tons more of production will be there.
So, in domestic market also increasing presence.
Last year have, sold around 40,000 in the domestic market.
This year, planning will be selling around maybe 1 lakh or 1,20,000 in the domestic market and the rest will go to the exports.

Now coming to the industry outlook.

The LME price There was a downfall in April‐25 when LME price fell down to $2,380 per ton because of the tariff announcements by US President. Since then, the LME price has recovered and it has reached to about $2,560 per ton.

The LME price going ahead are likely to be impacted by the tariff developments, which are still uncertain.
Though the 90 days period has elapsed, but still there are lots of negotiations to go and the tariff rates are far from over.
So, the developments, the LME price also will depend on the latest developments on the tariff of US announcements.
Then there are new starts in aluminum refining and smelting capacities, primarily in Indonesia and India.
Then, of course, there is rising oil prices and increase in US dollar index recently.
The LME price normally moves inversely with the rising oil prices and with the rising dollar index actually, the LME price moves intensely.
So, the LME prices will be impacted and there is disruptions in the bauxite supply also.

In Ghana also, there is one lease where the license was cancelled. So, for developments in these sectors, the LME price will also be impacted.

Now, coming to the global GDP growth, earlier in April 2025, IMF has projected 2.8% growth. But this time in July 2025, the tariff‐related developments have settled a bit as per IMF and they have projected a growth of 3%, which others were for the aluminum sector as well, because aluminum consumption is almost proportional to the growth of thecountry as well as the globe. So you can see in July 2025, the IMF has projected that there will be 3% growth for the year 2025 and 3.1% growth for the year 2026.

Coming to the alumina sector,

Alumina supply was a bit of downside on the last year, but the supply has improved recently and can see the difference between production and consumption, it is coming a little bit on the surplus side.
The alumina prices are also moving accordingly.
Coming to the aluminum sector, in the aluminum sector, there is growth, there is a little bit of deficit on the quarter to quarter basis and on the year estimation for the annual also, there is a little bit of deficit side.
So the aluminum sector is also dependent on the latest capacity additions.
The capacity at China is capped at 45 million tons currently. So currently China is almost about receiving 43‐44 million tons.
So the supply side will be limited to that. So in the H2 of this year and the next future years, the LME prices are likely to stay strong.

Rounaq Bakshi notes