National Aluminium Company Ltd. share price target

Nalco’s 1QFY17 EBITDA of INR1.9b (-18% QoQ/-13% YoY) was below est. of INR2.4b on lower aluminum volumes and higher costs. PAT of INR1.3b (est. of INR1.8b) was down 35% QoQ/17% YoY on higher depreciation due to accounting policy change. The negative surprise on aluminum cost in the quarter was primarily on account of negative operating leverage from re-stocking led lower sales volume. We largely maintain our estimates and TP. We estimate Nalco’s aluminum production to increase from 372kt in FY16 to 441kt by FY18E as it increases smelter utilization on improved domestic coal availability.

With fixed cost of more than USD600/t, higher volumes would deliver better cost absorption. Its alumina business is in the 1 st quartile of global cost curve and would help tide through the current depressed alumina market. Cost of production has tailwind of improving domestic coal quality and start of its captive mines. Maintain Buy with TP of INR67.

Topping ours as well as street estimate, National Aluminium Company (NALCO) has posted strong results in 4QFY16 despite challenging environment owing to higher volume and better operational performance of Aluminium division. EBITDA rose 75% qoq (-44% yoy) to Rs2.4bn (our estimate Rs2bn) due to sharp recovery in Aluminium division aided by lower power costs and higher volume. Aluminium sales grew by 25% yoy (7% qoq) to 103,873 tonne, while Alumina sales surged 32% yoy (31% qoq) to 372,000 tonne. Continuing to remain strong amid global decline, regional premium for Aluminium division stood at US$241/tonne, while...

9 Operating profit at Rs 2.4bn, 16% above estimates was driven by higher volumes and lower power (lower coal & FO prices) and employee costs. Higher other income (26% aboveestimates)ledtonetprofitofRs2.1bn,whichwas37%aboveourestimate....

National Aluminium Limited (NALCO) posted weak 3QFY16 result, which was lower than our estimate, despite revenue beat due to better operational performance from the aluminium division. EBITDA, during the quarter, fell 74% yoy and 60% qoq to Rs1.4bn (our estimate Rs1.65bn). EBITDA was lower than our estimate due to higher than expected loss from the Aluminum division coupled with a steeper than expected fall in Alumina realization and lower than forecasted alumina sales volume. Alumina sales volume at 285,000tonnes (our estimate 320,000tonnes) increased 2% yoy but fell 10% qoq. Alumina realization at US$267/tonne declined 23% yoy...

stock will benefit significantly if any of these were to materialise. The latter two developments especially (if they materialise) could positively impact our FY17 operating profit/EPS estimates by 64%/51%. Our valuations will increase to Rs 57 in these events....

remain challenging with LME reaching multiyear lows and premiums declining sharply. The companyhas negotiated CY16 alumina contracts at rates that are much better than currentspotprices.Ithasbenefitedfromlowerrawmaterialcostswithmarginalscopefor...

9 Operating profit was driven by higher volumes and lower raw material and employee costs.Netprofitwas45%aboveourestimateatRs2.3bn. 8 AluminiumsegmentreportedalossofRs1.1bnasLMEpricesandpremiumdeclined....

National Aluminium Limited (NALCO) posted strong 2QFY16 result, which was above our estimate, due to better operational performance from the alumina division. EBITDA, during the quarter, fell 29% yoy but increased 52% qoq to Rs3.4bn (our estimate Rs1.9bn). EBITDA was above our estimate due to higher than expected Alumina realization and in-turn profitability. Alumina sales volume at 315,000 tonnes (our estimate 320,000 tonnes) increased 43% qoq. (It must be noted that 1QFY16 volumes were affected due to maintenance shutdowns). Alumina realization at US$302/tonne was flat qoq, but fell 7% yoy and was higher...

our FY16/17 EPS estimates by 44%/34% respectively to Rs 2.8/3.1 to factor in the sharp drop in prices. We retain our Buy rating on the stock, but lower our target price to Rs 41 (from Rs 65). Strong profitability from the alumina segment will be...

National Aluminium Limited (NALCO) posted weak 1QFY16 result, which was below our as well as street estimate, due to lower alumina sales and higher than anticipated aluminium costs. EBITDA, during the quarter under review, plunged 19% yoy and 48% qoq to Rs2.2bn (our estimate Rs3bn). EBITDA was below estimate due to substantially lower Alumina sales volume at 220,000 tonnes, down 30% yoy and 22% qoq as against our estimate of 305,000 tonnes. Alumina sales volume was low due to weak Alumina production on the back of maintenance shutdowns, during the quarter. Aluminium sales at 78,000 tonnes was flat yoy, but...