NMDC margin rebounds to 36.33% as costs fall faster than revenue
The consolidated margin recovered from Q4FY26, but annual profit growth remained limited as expenses outpaced revenue and other income supported pre-tax profit.
Filed 15 Aug 2026, 01:56 IST · after market close · NMDC Ltd (NMDC)
Key takeaways
- Revenue grew +0.84% YoY, but expenses rose +1.56%, narrowing operating margin by 0.45 percentage points to 36.33%.
- Net profit increased +0.44% YoY to Rs 1,976.33 cr despite lower operating profit, helped by a 20.41% fall in interest expense.
- Operating margin rebounded 13.02 percentage points QoQ as expenses fell faster than revenue, while other income contributed 11.94% of pre-tax profit.
Price around the results
Operating profit slips despite broadly flat YoY revenue
NMDC’s consolidated revenue increased +0.84% YoY, but operating profit declined -0.41% as expenses grew faster than sales. That pushed operating margin down 0.45 percentage points to 36.33%. Net profit still rose +0.44%, as interest expense fell -20.41% and depreciation declined -5.16%.
Expense relief drove the sharp QoQ margin recovery
Revenue fell -40.09% QoQ, but expenses dropped even faster at -50.26%, lifting operating margin by 13.02 percentage points. Lower interest expense, down -57.97%, and a 3.92-percentage-point reduction in the tax rate also limited the impact on net profit. Other income accounted for 11.94% of pre-tax profit, so reported earnings were not entirely operating-led.
Margin reverses the four-quarter slide and stays well above peers
Operating margin had declined from 36.78% in Q1FY26 to 23.31% in Q4FY26 before recovering to 36.33% in Q1FY27. The current margin was 18.17 percentage points above the 18.16% median for the 81 commodities peers that had reported. The YoY comparison remains less favourable because costs grew 1.56% against revenue growth of 0.84%.
The initial stock reaction was positive but not unusual
The stock returned +1.30% on the first day after results and +1.78% after five sessions, with relative returns of +1.62% and +2.38%, respectively. Both moves were below the stock’s 2.58% median absolute move after its past eight results. Trading volume was 2.46 times the reference level on the first day.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹6,795 cr | ₹11,343 cr | -40.09% | +0.84% |
| Other income | ₹318 cr | ₹442 cr | -28.08% | +5.83% |
| Expenses | ₹4,327 cr | ₹8,700 cr | -50.26% | +1.56% |
| Operating profit | ₹2,468 cr | ₹2,644 cr | -6.62% | -0.41% |
| Operating margin (%) | 36.33% | 23.31% | — | — |
| Interest | ₹22 cr | ₹51 cr | -57.97% | -20.41% |
| Depreciation | ₹103 cr | ₹152 cr | -32.05% | -5.16% |
| Profit before tax | ₹2,662 cr | ₹2,883 cr | -7.66% | +0.70% |
| Tax | ₹685 cr | ₹855 cr | -19.86% | +1.47% |
| Net profit | ₹1,976 cr | ₹2,027 cr | -2.51% | +0.44% |
| EPS (₹) | ₹2.25 | ₹2.31 | -2.60% | +0.45% |
Operating margin of 36.33% compares with a Commodities sector median of 18.16% across 81 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +1.30% | +1.62% |
| Next session | -0.25% | — |
| 5 sessions | +1.78% | +2.38% |
| 15 sessions | -0.65% | — |
Volume on the results session was 2.46× its 20-day average.
What to watch
- Whether operating margin holds above 36.33% after the QoQ rebound.
- Whether expenses grow more slowly than revenue after rising +1.56% versus +0.84% YoY.
- Whether other income remains near 11.94% of pre-tax profit.