Nalco gains after setting financial targets for FY 2017

National Aluminium Company rose 1.82% to Rs 47.45 at 12:11 IST on BSE after the company said it has signed a memorandum of understanding with the ministry of mines regarding financial and non-financial targets for the current financial year.

The announcement was made after market hours yesterday, 18 July 2016.

Meanwhile, the S&P BSE Sensex was down 25.20 points or 0.09% at 27,721.46.

On BSE, so far 94,000 shares were traded in the counter as against average daily volume of 2.24 lakh shares in the past one quarter. The stock hit a high of Rs 47.90 and a low of Rs 47.10 so far during the day. The stock had hit a 52-week high of Rs 51.40 on 13 July 2016. The stock had hit a 52-week low of Rs 28 on 25 August 2015. The stock had outperformed the market over the past one month till 18 July 2016, surging 12.97% compared with Sensex's 4.21% rise. The scrip had, however, underperformed the market in past one quarter, advancing 3.1% as against Sensex's 7.48% rise.

The large-cap company has equity capital of Rs 1288.62 crore. Face value per share is Rs 5.

As per the memorandum of understanding (MoU), National Aluminium Company's (Nalco) target for revenue from operations, excluding excise duty, has been fixed at Rs 7100 crore for the current financial year (FY 2017). The MoU has also set higher targets for production of both alumina and aluminium as compared to the previous financial year. Nalco has set an annual production target of 21.30 lakh tonnes of alumina and 3.85 lakh tonnes of aluminium for FY 2017. The company had produced 19.53 lakh tonnes of alumina and 3.72 lakh tonnes of aluminium in FY 2016.

Nalco has set a capex target of Rs 1021 crore, which includes projects like development of Utkal D&E coal blocks, wind power projects of 50 megawatts (MW) each in Maharashtra and Rajasthan, addition of fifth stream in the existing alumina refinery at Damanjodi, Koraput, a 20 MW solar power project in Madhya Pradesh and other modernization activities.

Meanwhile, Nalco announced after market hours yesterday, 18 July 2016, that it has fixed 29 July 2016 as the record date for the purpose of share buyback. Nalco's board had earlier approved the proposal for buyback of shares not exceeding Rs 2834.96 crore at a maximum buyback price of Rs 44 per share.

Nalco's net profit declined 41.4% to Rs 207.94 crore on 3.3% growth in net sales to Rs 1836.86 crore in Q4 March 2016 over Q4 March 2015.

State-run Nalco has integrated and diversified operations in mining, metal and power. The Government of India (GoI) held 80.93% stake in the company (as per the shareholding pattern as on 30 June 2016).

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