- Shares of NMDC, India’s largest iron ore producer, have surged by 1% to reach a 14-year peak of ₹271.70 per share.
- The stocks have been on an upward trend since June 2023, accumulating a gain of 143% and currently trading 471% higher from their 2020 low point.
- Despite this rally, the stock still has a long way to reach its all-time high of ₹439 per share, achieved in January 2010.
NMDC shares hit a 14-year peak, trading 471% higher from their 2020 low point. The stock continues to surge, backed by the company’s robust performance and positive market outlook.
NMDC Shares Continue Upward Trend
Shares of NMDC have been on a steady rise since June 2023, closing nine out of ten subsequent months in positive territory. From their low point of ₹47.30 per share in 2020, the shares are currently trading 471% higher. Despite this significant rally, the stock still has a long way to go to reach its all-time high of ₹439 per share, achieved in January 2010.
Company Performance and Market Outlook
In its business update for April, released on May 2, NMDC reported a slight 2.60% growth in iron ore sales, reaching 3.43 million metric tons (MT), while production declined year-on-year to 3.48 MT in April 2024 from 3.51 MT in April 2023. On April 29, the public sector mining major raised iron ore prices by ₹400 per tonne for lump ore and by ₹200 for fines. With the latest revision, lump ore prices have surged by 59% over the past year, while fines have seen a significant increase of 48% year-on-year.
Bullish Outlook from Brokerage Firm
Domestic brokerage firm LKP Securities initiated coverage on the stock with a ‘buy’ rating and set a target price of ₹297 per share. The brokerage outlined several key factors supporting its bullish outlook on NMDC, including the company’s position to leverage the growing demand for steel in India, potential resurgence in capital expenditure, proactive approach in expanding mine capacity to meet future demand, and abundant access to high-quality ores for the next four decades.
Conclusion
NMDC’s strong performance and positive market outlook have led to a steady rise in its share prices. The company’s proactive approach to leverage growing steel demand, expand mine capacity, and its access to high-quality ores position it well for future growth. Investors should keep a close eye on this stock as it continues its upward trajectory.
