NALCO Q3 Results: Stock down 9% ahead of earnings; demand, capex guidance in focus

Shares of National Aluminium Company Ltd. (NALCO) are trading with losses of nearly 9% on Friday, January 30, ahead of their December quarter results announcement.

A CNBC-TV18 poll expects the company's revenue from operations to drop 3.5% to ₹4,499 crore from ₹4,662 crore last year.

Its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter may drop 8% to ₹2,149 crore from ₹2,328 crore last year, while margins may narrow by over 200 basis points to 47.8% from 50% last year, as per the poll.

Margins are seeing narrowing from last year, but may improve sequentially due to higher EBITDA contribution from the Aluminium segment, supported by higher Aluminium prices.

Net profit for the period is seen flat at ₹1,555 crore from ₹1,566 crore last year.

Although favourable Aluminium prices could support results for this as well as the next quarter, softening Alumina prices could cap those benefits.

Kotak Institutional Equities is projecting Alumina sales to be at 3 lakh tonnes, and Aluminium sales to be at 1.15 lakh tonnes. Alumina EBITDA is projected at ₹410 crore, while Aluminium EBITDA is likely to be at ₹1,500 crore, according to the Kotak note.

The management's guidance on domestic demand and capex outlook will be key to watch.

Shares of NALCO are trading 8.5% lower on Friday at ₹392.5 in-line with the sell-off seen across metals. The stock has more than doubled in value in the last 12 months, rising 103%.