NMDC Limited

Basic Materials — Steel · NSE

₹71.69+₹0.87 (+1.23%)

DalalBaazaar Score

76 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

No individual risk factor stands out on this snapshot.

In simple words: Strong business and financial position, with modest growth. Nothing obvious stands out as stretched — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

The 60-second version of NMDC Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

NMDC Limited, together with its subsidiaries, explores for and produces iron ore in India and internationally. It operates through Iron Ore, Trading of HR Coil, and All Other Segments (Pellets, Other Mineral, Products, Services & Others).

IndustrySteel

SectorBasic Materials

Employees5,730

Annual revenue₹32,069 Cr

How does it make money?

Turns over ₹32,069 Cr a year. Of every ₹100 of sales, about ₹23 reaches shareholders as profit, with ₹34 left at the operating level before interest, tax and depreciation. Each of its 5,730 employees supports ₹5.60 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹5.60 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, JINDAL STEEL LIMITED, STEEL AUTHORITY OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 28.4%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 21.9% against a peer median of 10.8% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE10.8%

What is the outlook?

12 analysts covering the stock expect revenue to grow about 6.5% and earnings to grow about 7.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+6.5%

Est. earnings growth+7.8%

Analysts12

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +82% while net margin moved -27% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+82%

Margin effect-27%

DalalBaazaar Score

76/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Revenue CAGR of 22.0% — compounding well above nominal GDP
• Profit CAGR of 10.0%
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Latest-year revenue growth of 0.8% is below the longer-term trend — momentum is fading

Quality vs. Valuation

Company Quality

75/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

85/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

8.4x

3Y Median

11.0x

40 monthly readings · mean 10.7x · range 6.4x–13.6x

Sector Median

18.2x

median of 4 sector peers

🟢Current valuation is approximately 23% below its 3y median of 11.0x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 54% below the peer median of 18.2x.

vs. its own history

Cheap

11.0x median over 40 months · -23%

vs. sector peers

Cheap

18.2x median of 4 peers · -54%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

6.4x

PEG

0.85

What's Good / What's Bad

🟢 What's Going Well4

Cash generation is improving
Free cash flow is up 209% over 3 years.
High return on capital employed
ROCE of 28.4% is the mark of a business that converts capital into profit efficiently.
Very low debt
Debt/Equity of 0.19x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 32.1% to 28.4% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 201% over 3 years, from ₹2,128 Cr to ₹6,407 Cr.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 5.1 points, from 38.6% to 33.5%.
🟡Receivables growing faster than salesFinancial
Receivables up 111% against revenue up 82% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 28.4% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Priced below its own history
The stock trades 23% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 54% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹1,826 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 38.6% to 33.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 111% against revenue up 82%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 16% a year✓ 22.0% CAGR
Latest reported year was 0.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 32%✓ 33.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹1,826 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 25%✓ 28.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 12 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

7 good · 4 neutral · 0 weak

Market Cap

₹63,029 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

8.4x

Cheap

Cheap against the generic band

P/B Ratio

1.85x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹8.49

Profitable

Profitable on a per-share basis

ROE

21.9%

Strong

Strong capital efficiency

ROCE

28.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.19x

Low

Conservative leverage

Revenue Growth (YoY)

0.8%

Modest

Modest growth

Profit Growth (YoY)

0.4%

Modest

Slow profit growth

Dividend Yield

2.79%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹1,826 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

6.9x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

34.8%

Good

Healthy core-business profitability

Net Margin

23.2%

Good

Strong bottom-line conversion

Current Ratio

2.43

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.64

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

75.3 / 81.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

23.4

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹17,661 Cr	₹21,301 Cr	₹23,901 Cr	₹32,069 Cr	+22.0%
EBITDA	₹6,819 Cr	₹8,671 Cr	₹9,744 Cr	₹10,751 Cr	+16.4%
EBITDA Margin	38.6%	40.7%	40.8%	33.5%	—
PAT (Net Profit)	₹5,601 Cr	₹5,575 Cr	₹6,542 Cr	₹7,450 Cr	+10.0%
EPS	₹6.37	₹6.34	₹7.44	₹8.47	+10.0%
ROE	24.8%	21.7%	22.0%	21.9%	—
ROCE	32.1%	29.5%	29.7%	28.4%	—
Total Debt	₹2,128 Cr	₹3,359 Cr	₹4,276 Cr	₹6,407 Cr	+44.4%
Free Cash Flow	₹590 Cr	₹5,547 Cr	-₹1,336 Cr	₹1,826 Cr	+45.7%

🟢 Revenue has grown at 22.0% a year over 3 years.

🟢 EBITDA has grown at 16.4% a year over 3 years.

🔴 EBITDA Margin has fallen from 38.6% to 33.5% over 3 years (-5.1 pts).

🟢 PAT (Net Profit) has grown at 10.0% a year over 3 years.

🟢 EPS has grown at 10.0% a year over 3 years.

🔴 ROE has fallen from 24.8% to 21.9% over 3 years (-2.9 pts).

🔴 ROCE has fallen from 32.1% to 28.4% over 3 years (-3.8 pts).

🔴 Total Debt has grown at 44.4% a year over 3 years.

🟢 Free Cash Flow has grown at 45.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹48,320 Cr

Total Liabilities

₹14,244 Cr

Cash & Equivalents

₹148 Cr

Operating Cash Flow

₹4,996 Cr

Capex

-₹3,171 Cr

Shareholding (proxy)

Institutional Holding

20.9%

Insider Holding

60.8%

Corporate Actions

Next Earnings

29 Oct 2026

Dividend Rate

₹2

Ex-Dividend Date

05 Oct 2026

Analyst Consensus

Recommendations

8 Buy · 4 Hold · 10 Sell

Target Price (Mean)

₹88.48

+23.4% vs CMP

Target Range

₹67 – ₹112

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
JINDAL STEEL LIMITED	39.1x	5.3%
STEEL AUTHORITY OF INDIA	16.5x	7.1%

Recent News

3 mixed3 general

NMDC Steel share price jumps 6%; what's next as experts see weakness in technical chart | Support, resistance

Livemint, 15 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

NMDC Share Price Falls 2.03%: Price Action and Valuation

Univest, 12 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Tata Steel vs Hindalco vs JSW vs Nalco vs SAIL vs NMDC: Which Metal Stock To Gain From Aluminium Price Shock?

Goodreturns, 16 Oct

NMDC Steel Limited (NSLNISP) Share Price NSE

TechGraph, 07 Oct

NMDC shares decline 4% after Q1 results. Should you buy, sell or hold the stock?

The Economic Times, 17 AugPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Where Will NMDC Share Price be in the Next 3 Years?

Equitymaster, 06 Aug

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Profitability · Valuation · Risk

MiddlingGrowth

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 2 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑