Navratna PSU company engaged in the industrial minerals sector, NMDC Ltd traded higher on Wednesday, January 1st after the allotment of free bonus shares. The company has allotted over 586 crore free shares to eligible shareholders. NMDC turned ex-date for its second bonus issue in its history. Another fuelling factor to NMDC stock was its production performance that surged in December 2024 and 9M of FY25 on a year-on-year basis.
NMDC Share Price:
After bonus issue allotment, NMDC share price ended at Rs 65.98 apiece, with a market cap of Rs 58,008.41 crore. The stock's 52-week high and low is at Rs 95.35 apiece and Rs 63.39 apiece after adjusting to bonus ratio.
NMDC Bonus Issue Allotment:
NMDC shares turned ex-date on December 27, 2024, for its bonus issue in the ratio of 2:1, i.e. 2 (two) Bonus Equity Shares of face value ₹1/- each fully paid up; for every 1 existing equity share of the face value of ₹1/- each fully paid up, to the eligible members of the Company as on the record date
Later, on December 30th, NMDC announced the allotment of 586,12,11,700 (Five Hundred Eighty-Six Crores Twelve Lakh Eleven Thousands & Seven Hundred) equity shares of Rs 1/- each. The deemed date of allotment is Monday, December 30, 2024. The effective date for listing these bonus shares was Tuesday, December 31, 2024.
On January 1st, NMDC shares traded with its bonus issue as well on both BSE and NSE.
It needs to be noted that this was the second bonus issue by NMDC, however, the first in 16 years. The last time NMDC sanctioned bonus shares to investors was in May 2008, also in the ratio of 2:1.
NMDC Production & Sales:
As per the regulatory filing on Wednesday, NMDC recorded a total production of 4.71 MT in December 2024, while sales stood at 3.91MT. The production rose from 4.48MT in December 2023, while sales dipped from 4.19MT recorded in December 2023.
Cumulatively for FY25, the company's production and sales were at 30.77 MT and 31.80 MT from April to December 2024.
BUY NMDC?
As per Trendlyne data, the consensus recommendation from 19 analysts for NMDC Ltd. is HOLD. EPS is expected to grow by 25.0% in FY25. The new average target price is Rs 80.88 apiece on NMDC, signalling over 23% potential upside ahead.
Some of the key positive fundamentals for NMDC stock as per Trendlyne are --- Price to Earning Ratio is 9.54, lower than its sector PE ratio of 26.34; Debt to Equity Ratio of 0.13 is less than 1 and healthy, which implies that its assets are financed mainly through equity; and Return on Equity(ROE) for the last financial year was 21.73%, more than 20% in the last financial year, indicating an efficient use of shareholder's capital to generate profit.
About NMDC:
National Mineral Development Corporation (NMDC), a Navratna Public Sector Enterprise under the Ministry of Steel, Government of India is the single largest producer of iron ore in India. It owns and operates highly mechanized iron ore mines in Chhattisgarh and Karnataka and has its registered office in Hyderabad, Telangana. NMDC is considered to be one of the low-cost producers of iron ore in the world. It also operates the only mechanized diamond mine in India at Panna, Madhya Pradesh.
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