NMDC Steel Ltd (Rs.41.87): A Turnaround Story Gathers Momentum as Nagarnar Plant Delivers Breakthroughs.
~Sumon Mukhopadhyay.
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Spun off from NMDC, the country’s largest iron ore producer, the company has spent the last year sharpening its operations, scaling production, and proving that the Nagarnar integrated steel plant is more than ready to enter India’s big league.
Now, with two back-to-back strong quarters, production records tumbling, and investors rediscovering confidence in the counter, NMDC Steel’s turnaround story is entering an exciting new phase.
The stock of NMDC Steel Ltd was recommended several times on SumanSpeaks and this is just a follow - on article; for those who are either still holding the scrip or are contemplating to take fresh positions.
Q2FY26: Revenue Doubles, Losses Narrow Sharply:
The July–September 2025 quarter marked a defining moment.
- Revenue jumped to ₹3,411 crore, soaring 122% year-on-year, thanks to stronger production and sales momentum.
- EBITDA swung into the green at ₹207 crore, compared to a loss of ₹441 crore last year.
- Net loss shrank to ₹115 crore, a dramatic 81% improvement, with analysts noting that most of the remaining drag came from temporary inventory adjustments.
- The stock reacted with optimism, joining high-performing peers like L&T and BHEL on “good results” lists.
With core operations strengthening and capacity ramp-up on track, NMDC Steel appears firmly positioned for sustained profitability in the coming quarters.
Q1FY26: The First Profit After Listing:
Before Q2’s strong performance came the historic breakthrough in Q1 FY26.
- The company posted its first-ever quarterly profit since listing: ₹26 crore, compared to a ₹547 crore loss last year.
- Revenue climbed 66% YoY to ₹3,365 crore.
- EBITDA surged to ₹408 crore, reversing a previous-year loss of ₹401 crore.
- The market loved it — the stock shot up 18% in a single session, its biggest intraday gain to date.
This quarter marked the psychological turning point: investors finally saw the plant’s economics fall into place.
Nagarnar Plant Hits Record Production Benchmarks:
The 3 MTPA Nagarnar integrated steel plant has quietly become NMDC Steel’s engine of growth — and 2025 was its breakout year.
Key highlights include:
- Rated capacity achieved across multiple units, including the Raw Material Handling System (RMHS), which hit a record 23,307 tonnes per day.
- Coke Oven operations achieved 186 daily pushings, a new benchmark for the plant.
- The Steel Melting Shop and Blast Furnace posted their best-ever performance.
- Pellet production touched 0.23 lakh tonnes, surpassing the previous 2018 high.
- For the first time, the plant supplied liquid nitrogen to the Chhattisgarh government, enhancing its regional economic contribution.
Chairman Amitava Mukherjee called these achievements a “proud defining moment,” aligning with India’s ambition to scale domestic steelmaking capabilities.
Rising Investor Interest and Sector Tailwinds:
Sentiment has improved significantly:
- FIIs raised their stake to 5.13% by September 2025 (up from 4.67% in June).
- Mutual funds such as Edelweiss, HDFC, and Motilal Oswal hold a combined ~4%.
- Sector momentum has been favourable: shares across steel companies rallied after the DGTR proposed a 12% safeguard duty on certain steel imports, helping domestic players like NMDC Steel.
- Technical analysts highlight strong chart structure, with support around ₹41–42 region and has room for upside on sustained volume and earnings traction.
- NMDC reported an 11% rise in iron ore production in November 2025, with cumulative FY26 production and sales significantly ahead of last year. Rising production ensures steady supply for NMDC Steel’s Nagarnar plant, enhancing profitability potential.
- Sector outlook: With India’s steel consumption expected to grow 8–10% annually, NMDC Steel is well-positioned to benefit from infrastructure and real estate demand.
- A potential geopolitical tailwind also lies on the horizon. If the Russia–Ukraine conflict moves toward resolution, Russian crude oil could return more freely to global markets, increasing supply and driving down international oil prices. A softer crude environment would significantly reduce input and transportation costs for energy-intensive sectors such as steel, cement, and construction. For NMDC Steel, lower fuel and logistics expenses would further strengthen operating margins and accelerate the company’s journey toward consistent profitability.
Stock Snapshot (November 2025):
- Current Price: ~₹41.87.
- Market Cap: ~₹12,270 crore.
- YTD Performance: Down ~8%, but on a clear recovery path.
- 1-Year Return: –7.91%, improving rapidly on better results and plant ramp-up.
Looking Ahead: Profitability on the Horizon:
With the Nagarnar plant now stabilising, backward integration via NMDC’s iron ore supply, and investor sentiment turning constructive, NMDC Steel is entering FY26 with momentum on its side.
The company’s renewed focus on operational efficiency, capacity optimisation, and cost discipline suggests that consistent profitability may not be far away. For investors tracking India’s steel story, NMDC Steel is fast becoming a name worth watching closely.
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