⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
NATIONALUM - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.2
| Stock Code | NATIONALUM | Market Cap | 71,142 Cr. | Current Price | 387 ₹ | High / Low | 432 ₹ |
| Stock P/E | 11.5 | Book Value | 109 ₹ | Dividend Yield | 2.71 % | ROCE | 43.7 % |
| ROE | 32.6 % | Face Value | 5.00 ₹ | DMA 50 | 359 ₹ | DMA 200 | 282 ₹ |
| Chg in FII Hold | 3.45 % | Chg in DII Hold | -3.10 % | PAT Qtr | 1,601 Cr. | PAT Prev Qtr | 1,433 Cr. |
| RSI | 55.1 | MACD | 9.64 | Volume | 1,13,93,247 | Avg Vol 1Wk | 2,03,33,419 |
| Low price | 138 ₹ | High price | 432 ₹ | PEG Ratio | 0.53 | Debt to equity | 0.00 |
| 52w Index | 85.0 % | Qtr Profit Var | 1.14 % | EPS | 33.6 ₹ | Industry PE | 17.0 |
📊 Financials
- Revenue & Profitability: PAT rose from ₹1,433 Cr. to ₹1,601 Cr. (+1.14%), showing steady growth. EPS at ₹33.6 is strong.
- Margins & Returns: ROCE (43.7%) and ROE (32.6%) are excellent, reflecting high efficiency and profitability.
- Debt: Debt-to-equity ratio of 0.00 → debt-free, ensuring strong financial stability.
- Cash Flow: Strong profitability and zero leverage support robust cash flows.
💹 Valuation
- P/E Ratio: 11.5 vs Industry PE of 17.0 → Undervalued compared to peers.
- P/B Ratio: ~3.55 (Price ₹387 / Book Value ₹109) → Reasonable valuation.
- PEG Ratio: 0.53 → Attractive, growth justifies valuation.
- Intrinsic Value: Current price appears undervalued, offering upside potential.
🏢 Business Model & Competitive Advantage
- National Aluminium Company (NALCO) operates in aluminium production and mining, benefiting from strong domestic demand and global commodity cycles.
- Competitive advantage lies in government backing, cost efficiency, and integrated operations.
- Dividend yield of 2.71% provides attractive shareholder returns.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive near ₹350–370 range (close to DMA 50 at ₹359 and DMA 200 at ₹282).
- Long-Term Holding: Strong candidate for long-term investors due to undervaluation, robust ROE/ROCE, and debt-free balance sheet.
✅ Positive
- Undervalued compared to industry peers (P/E 11.5 vs 17.0).
- Strong ROCE (43.7%) and ROE (32.6%) indicate excellent efficiency.
- Debt-free balance sheet ensures financial safety.
- Dividend yield of 2.71% is attractive.
- FII holdings increased (+3.45%), showing strong foreign investor confidence.
⚠️ Limitation
- DII holdings reduced (-3.10%), showing cautious domestic sentiment.
- Quarterly profit growth (+1.14%) is modest relative to valuation potential.
- Commodity price cycles may impact earnings volatility.
📉 Company Negative News
- DII holdings reduced (-3.10%), reflecting weaker domestic institutional support.
- High dependence on global aluminium prices may affect margins.
📈 Company Positive News
- PAT improved sequentially, reflecting operational strength.
- FII holdings increased significantly (+3.45%), signaling global investor confidence.
- MACD at +9.64 indicates bullish technical momentum.
🏭 Industry
- Aluminium industry benefits from infrastructure growth, renewable energy demand, and global industrial expansion.
- Industry PE at 17.0 suggests peers trade at higher valuations, making NALCO attractive.
🔎 Conclusion
- NALCO is fundamentally strong with excellent efficiency, debt-free balance sheet, and attractive dividend yield.
- Undervalued compared to peers, offering strong upside potential.
- Best strategy: Accumulate near ₹350–370 range for long-term holding, focusing on dividend income and sectoral growth.