NMDC Meets Street Expectation, Net Profit Increased By 34% YoY

NMDC, a navaratna public sector company and the largest iron producer in the country posted a decent set of numbers for January-March 2014 quarter. Net profit of the company was at par with the street expectation and increased by 34% on yearly basis to Rs 1962 crore for Q4FY14. This was backed by the good growth witnessed in the topline of the company and a fall in the other expenses of the bank. 

Total revenue of the company has increased by 21% on yearly basis to Rs 3883.52 crore for quarter ending March 2014, against the street estimates of Rs 3685 crore. The increase in sales was primarily due to price hike taken by company in the month of December as well in the month of February by Rs 200 per tonne and Rs 100 per tonne respectively. Moreover, despatches too grew by 17% due to re-start of Essar slurry pipeline aiding revenue growth. 

EBITDA of the company increased by 42% on yearly basis to Rs 2426 crore for Q4FY14. EBITDA margins too saw substantial improvement by 9%. This was mainly helped by fall in the other expenses that fell by 19% on yearly basis and formed 20% of total revenue. 

Shares of the company closed at Rs 170 in today's trading down by 1% from previous close. Currently, share price of the company is quoting at price to earnings of 10.5 times, which looks attractive after looking the performance of NMDC. Besides this the company is sitting on cash and bank balance of Rs 18657 crore at the end of FY14, which comes out to be Rs 47 per share.