NMDC Steel Limited returns to profit as September revenue rises

NMDC Steel returned to a Rs 61.03 crore profit in the quarter ended 30 September 2026, compared with a Rs 114.78 crore loss a year earlier, as revenue from operations increased to Rs 3,764.37 crore from Rs 3,389.90 crore. Profit also rose from Rs 50.51 crore in the preceding June quarter.

How did NMDC Steel return to profit in September 2026?

NMDC Steel returned to profit by reporting Rs 102.72 crore of profit before tax for the September 2026 quarter, against a Rs 182.65 crore loss before tax in September 2025. The company recorded no exceptional items in either quarterly result, so the movement reflects the reported income and expense lines before deferred tax.

Revenue from operations increased by Rs 374.47 crore year on year to Rs 3,764.37 crore, while total income, which includes other income, reached Rs 3,792.88 crore. Other income was Rs 28.51 crore, compared with Rs 21.13 crore in the year-earlier quarter. Total expenses were Rs 3,690.16 crore, compared with Rs 3,593.68 crore a year earlier, leaving a positive pre-tax result.

NMDC Steel’s September-quarter profit was Rs 10.52 crore higher than the Rs 50.51 crore reported in the June 2026 quarter. Revenue rose by Rs 102.53 crore sequentially, while profit before tax increased by Rs 28.77 crore. Total comprehensive income was Rs 61.06 crore for September, including Rs 0.03 crore of other comprehensive income.

What changed in NMDC Steel’s costs?

NMDC Steel’s cost of materials consumed rose to Rs 2,606.64 crore in the September 2026 quarter from Rs 2,013.96 crore a year earlier, an increase of Rs 592.68 crore. Finance cost was Rs 136.61 crore, up from Rs 128.43 crore in the September 2025 quarter.

The reported inventory-change line was negative Rs 139.54 crore in September 2026, compared with a positive Rs 356.70 crore expense in September 2025. Other expenses were Rs 799.12 crore, compared with Rs 789.93 crore a year earlier, while depreciation and amortisation declined to Rs 251.91 crore from Rs 282.62 crore.

Deferred tax expense was Rs 41.69 crore in the latest quarter, compared with a deferred tax credit of Rs 67.87 crore in the prior-year period. The difference between pre-tax profit of Rs 102.72 crore and period profit of Rs 61.03 crore therefore included a reported tax charge, whereas the September 2025 loss was reduced by the deferred tax credit.

For the half year ended 30 September 2026, NMDC Steel reported revenue from operations of Rs 7,426.21 crore, up from Rs 6,755.12 crore in the same period of 2025. Profit for the half year was Rs 111.54 crore, against a Rs 89.22 crore loss a year earlier, while total expenses increased to Rs 7,320.94 crore from Rs 6,942.76 crore.

What do NMDC Steel’s borrowings and coverage ratios show?

NMDC Steel reported total borrowings of Rs 4,836.92 crore at 30 September 2026, down from Rs 5,298.63 crore a year earlier but above Rs 4,601.94 crore at 31 March 2026. Net worth stood at Rs 13,289.41 crore at the September reporting date, compared with Rs 13,025.26 crore at 30 September 2025.

The debt-equity ratio was 0.36 at 30 September 2026, compared with 0.41 a year earlier and 0.38 at 30 June 2026. The debt service coverage ratio, or DSCR, was 0.19 for the September quarter, compared with 0.13 a year ago. The interest service coverage ratio, or ISCO, was 1.75, compared with negative 0.42 in the year-earlier quarter; both quarterly ratios are stated as not annualised.

Finance cost increased sequentially to Rs 136.61 crore from Rs 126.38 crore in the June 2026 quarter. NMDC Steel’s notes state that State Bank of India revised the interest rate on its rupee term loan to 8.40% per annum as of 30 September 2026, based on the three-month marginal cost of funds-based lending rate, or MCLR. The rate had been reset to 12.45% per annum from 1 March 2025 before the revision.

The notes state that the outstanding rupee term loan was Rs 3,065.17 crore after repayment of Rs 1,410.64 crore as of 30 September 2026. They also state that there was no default in repayment of borrowings or interest at the reporting date, and describe repayment instalments running from March 2024 to June 2031.

Did NMDC Steel convert its half-year profit into operating cash?

NMDC Steel generated Rs 162.04 crore of net cash from operating activities in the half year ended 30 September 2026, below Rs 847.40 crore in the corresponding 2025 half year. Profit before tax moved to Rs 176.67 crore from a Rs 146.51 crore loss, but working-capital movements reduced the cash flow reported for the period.

Inventory absorbed Rs 613.47 crore of cash during the six months to September 2026, while it had released Rs 128.23 crore in the prior-year half year. Trade payables decreased by Rs 190.90 crore, compared with an increase of Rs 349.68 crore a year earlier. Trade receivables released Rs 29.62 crore of cash, compared with consuming Rs 202.56 crore in the previous period.

Capital expenditure on tangible and intangible assets and capital work in progress was Rs 127.46 crore in the latest half year, compared with Rs 156.50 crore a year earlier. Net cash used in investing activities was Rs 133.13 crore, following positive Rs 99.57 crore in the prior-year period, while net cash used in financing activities narrowed to Rs 28.29 crore from Rs 930.60 crore.

Cash and cash equivalents closed at Rs 9.49 crore on 30 September 2026, compared with Rs 8.87 crore at the start of the half year. On the balance sheet, inventories stood at Rs 4,510.85 crore, up from Rs 3,897.38 crore at 31 March 2026, while current liabilities were Rs 12,405.64 crore, compared with Rs 12,195.26 crore six months earlier.

Conclusion

The September and half-year results show a move to positive reported pre-tax income, with Rs 102.72 crore in the quarter and Rs 176.67 crore in the six months. Higher revenue and lower quarterly depreciation were reported alongside a Rs 592.68 crore year-on-year rise in material consumption, while inventory absorbed Rs 613.47 crore of cash in the half year.

The disclosed item to watch next is the rupee term-loan repayment schedule, which runs through June 2031, alongside the 8.40% interest rate applicable at 30 September 2026. Subsequent results will also show whether inventories, which stood at Rs 4,510.85 crore at the reporting date, and finance cost of Rs 136.61 crore continue to affect cash flow and earnings.