Navratna PSU Metal Stock NALCO Is Rs 27 Awat From New Highs; Should You Buy? Rs 1/Dividend Record Date Ahead

Navratna PSU giant National Aluminium Company, popularly known as NALCO witnessed a strong buying trend on Wednesday. NALCO skyrocketed by nearly 9% on BSE on August 12, tracking a broad-based buying trend in metal stocks after Norway-based aluminium and energy company Norsk Hydro ASA announced that its Brazil-based Alunorte alumina refinery has trimmed output to 50% of capacity.

The decision is seen as positive news for Indian metal companies, as the output cut in Brazil could tighten the global supply of aluminum, and that could lead to a surge in prices. NALCO is expected to benefit.

NALCO Share Price:

After closing bell on August 12, NALCO stock stood at Rs 418.50 apiece on BSE, up by 8% with a market cap of Rs 76,863.04 crore. The stock zoomed by at least 9% when it touched an intraday high of Rs 422 apiece.

From the current market price, NALCO is now nearly Rs 27 away from crossing its 52-week high of Rs 445.10 apiece. NALCO shares have risen significantly in a year. The Navratna PSU is a multibagger with over 142% gains from its 52-week low of Rs 183.85 apiece. As per BSE data, NALCO's price-to-equity ratio stood at 11.38x and return on equity is at 42.60%.

NALCO Dividend

Apart from the output cut in Brazil, NALCO is also in focus this month due to its upcoming dividend record date. NALCO is scheduled to deliver final dividend of Rs 1. For this, the company has fixed August 24 as the record date to identify eligible shareholders.

Should You BUY NALCO Shares?

According to analysts at Axis Securities, NALCO's Alumina sales volume guidance for FY27 is 1.6 MT (vs. 1.4 MT in FY26), with the incremental production from the new refinery stream expected to be entirely sold in the merchant market. While LME spot Aluminium prices have cooled to ~$3,200/t (vs. $3,565/t Q1FY27 average) and raw material inflation (caustic soda, CPC, HFO) has raised Aluminium CoP by ~Rs 15,000-16,000/t over FY26 averages, stronger alumina spot realizations (~$360/t) and increased captive coal usage should partly cushion profitability. Alumina production costs are expected to remain broadly stable at Rs 21,000-22,000/t. FY27 capex guidance remains Rs 1,500-1,800 Cr, increasing to around Rs 2,500 Cr in FY28, before peaking during FY29-31 as expansion projects gather pace. Capex execution remains a key monitorable.

Hence, they have maintained BUY. However, NALCO has already crossed Axis Securities target price of Rs 420 on August 12. Also, the stock has surpassed Motilal Oswal's target of Rs 380 long ago.

Analysts at Motilal Oswal said, NACL posted strong earnings in 1Q as anticipated, led by favorable aluminum prices, which helped offset the muted alumina price and cost inflation impact during the quarter. However, the recent decline in aluminum prices is expected to limit the growth in the coming quarter, in the absence of volume growth.

They added, the company has planned a next phase of growth, enhancing its capacity significantly in the long run. However, with the completion timeline of FY30, execution risks and cost escalations remain key concerns.

Despite strong fundamentals, zero debt, favorable LME prices, and a robust demand outlook for aluminum in India, Motilal analysts believe that the near-term upside is capped by limited production headroom, geopolitical tension, execution challenges, and regulatory risks.

Overall, the consensus recommendation from 13 analysts for National Aluminium is BUY, as per Trendlyne data.

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