NMDC’s Q2FY24 EBITDA fell short of our expectations, primarily driven by lower realisations attributed to the increased volume contribution from Karnataka. Despite strong demand, alleviation of evacuation constraints resulted in a 25% y-o-y volume growth in in the first seven months of fiscal year 2024 (7MFY24). Consequently, we are revising our volume estimates upward by 5%/3% for FY2024/ 25E (estimates). In the short term, there is an upside risk to domestic iron ore prices, influenced by buoyant international iron ore prices. However, this may be partially offset by downward pressure on domestic steel prices. We revised our FV to Rs180 based on the rollover and improved earnings outlook.

Ebitda miss on lower realisations
NMDC posted revenues of Rs 4,010 crore (+21% y-o-y, -26% q-o-q), Ebitda of Rs 1,190 crore (+40% y-o-y, -40% q-o-q), and net profit of Rs 1,030 crore (+16% y-o-y, -38% q-o-q), falling short of our estimates of Rs 4,400 crore, Rs 1,350 crore, and R…