NMDC Steel lifts operating margin to 12.29% as costs stay contained
Quarterly profit before tax rose +38.90%, but a higher tax rate and increased interest expense reduced the conversion into net profit.
Filed 12 Nov 2026, 20:47 IST · after market close · NMDC Steel Ltd (NSLNISP)
Key takeaways
- Standalone revenue rose +2.80% QoQ while expenses increased +1.21%, lifting operating margin by 1.38 percentage points to 12.29%.
- Profit before tax grew +38.90% QoQ, but the tax rate rose 8.89 percentage points to 40.59%, limiting net profit growth to +20.83%.
- NMDC Steel's 12.29% operating margin was 0.11 percentage points below the 12.40% median for 149 reported commodities peers.
Price around the results
Revenue growth outpaced costs in Q2FY27
NMDC Steel's standalone revenue rose +2.80% QoQ to Rs 3,764.37 cr, while expenses grew only +1.21%. That operating leverage lifted operating profit +15.81% to Rs 462.73 cr and widened the margin by 1.38 percentage points to 12.29%.
Higher tax and interest diluted the operating gain
Interest expense increased +8.09% QoQ and depreciation rose +4.04%, even as operating profit improved. Profit before tax still rose +38.90% to Rs 102.72 cr, but the tax rate climbed from 31.70% to 40.59%, so net profit increased +20.83% to Rs 61.03 cr. Other income contributed 27.76% of pre-tax profit, making reported earnings partly reliant on non-operating income.
Margin recovered from Q1FY27 and sits near the peer median
The operating margin improved from 10.91% in Q1FY27 to 12.29% in Q2FY27, reversing the sequential pressure seen in the preceding quarter. It remained 0.11 percentage points below the 12.40% median among 149 commodities companies that had reported.
Results were filed after market close
NMDC Steel filed its standalone Q2FY27 results after market close on 12 Nov 2026. The quarter's key quality check is the gap between the operating improvement and the higher 40.59% tax rate, alongside the 27.76% contribution of other income to pre-tax profit.
Q2FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹3,764 cr | ₹3,662 cr | +2.80% |
| Other income | ₹29 cr | ₹43 cr | -33.53% |
| Expenses | ₹3,302 cr | ₹3,262 cr | +1.21% |
| Operating profit | ₹463 cr | ₹400 cr | +15.81% |
| Operating margin (%) | 12.29% | 10.91% | — |
| Interest | ₹137 cr | ₹126 cr | +8.09% |
| Depreciation | ₹252 cr | ₹242 cr | +4.04% |
| Profit before tax | ₹103 cr | ₹74 cr | +38.90% |
| Tax | ₹42 cr | ₹23 cr | +77.86% |
| Net profit | ₹61 cr | ₹51 cr | +20.83% |
| EPS (₹) | ₹0.21 | ₹0.19 | +10.53% |
Operating margin of 12.29% compares with a Commodities sector median of 12.40% across 149 peers that have reported Q2FY27.
What to watch
- Whether operating margin remains above 12.29% after the Q2FY27 recovery.
- Whether the tax rate moves down from 40.59%.
- Whether interest expense remains close to the Q2FY27 level after rising +8.09% QoQ.