NMDC Q2 Review - Earnings Below Estimates: Systematix
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Systematix Research Report
NMDC Ltd.’s Q2 FY22 adjusted Ebitda of Rs 31.1 billion (up 183% YoY, down 25% QoQ) was 8% below our estimates largely due to elevated royalty and premium related costs, which now constitute 75% of total costs versus 30% YoY. Net sales stood at Rs 67.9 billion.
Iron ore production for the quarter of 8.8 million tonne (up 57.1% YoY, down 1.2% QoQ) was 1% above our estimates, while sales of 8.9 million tonne (up 36.9% YoY, down 5.8% QoQ) were 6% above our estimates.
Average sales realisation stood at Rs 7,633/tonne (up 122.5% YoY, up 10.8% QoQ). The cost of production (excluding selling expenses, royalty) was $34.4/tonne.
NMDC's iron ore prices are holding well despite a sharp drop in sea-borne prices. International iron ore prices have fallen by more than 50% since May 2021.
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