Hold NMDC; target of Rs 120: ICICI Direct

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26 Aug, 2025 12:21

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ICICI Direct's research report on NMDC

NMDC has a large reserve base with high grade deposits and significant mine life. As on April 1, 2016, as per UNFC, NMDC’s total iron ore reserve and resource base is 2299.2 MT (average Fe grade of 64.33%). At FY16 production run rate, the company has a mine life of 77 years (reserves: production: 77).

Outlook

NMDC reported a subdued performance in Q4FY17. Going forward, we expect sales volumes to grow at a CAGR of 6% in FY17-19E. We value the stock at 6.5x FY19E EV/EBITDA and arrive at a target price of Rs 120. We have a HOLD recommendation on NMDC.

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