NATIONALUM Q1 FY27 Results Analysis: EBITDA Margin Surges to 51%, Chemicals Margin Compression Persists

National Aluminium Company Ltd's Q1 FY27 numbers came in strong, with revenue of Rs. 5,302.38 Cr (+39.30% YoY) and PAT growth of +88.20% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

NATIONALUM delivered record revenue and PAT in Q1 FY27, driven by sharply higher LME aluminium prices and tight cost control. EBITDA margin surged to 51% as operating leverage kicked in. The new 1 MTPA refinery adds growth optionality, but chemicals margin compression remains a near-term headwind.

Key Investment Insights

Key Positives

• Revenue grew 39.3% YoY to Rs.5,302.38 Cr, highest quarterly revenue ever
• PAT grew 88.2% YoY to Rs.2,002.38 Cr, highest ever quarterly PAT
• EBITDA margin expanded 1,186 bps YoY to 51.06%
• Aluminium segment EBIT margin surged from 33.16% to 55.52% YoY
• Total expenses grew only 11.4% YoY vs 39.3% revenue growth, showing operating leverage
• Employee benefits cost declined 11.2% YoY, ahead of management's flat-cost guidance

Risk Factors

• Chemicals segment revenue fell 3.6% YoY and EBIT margin compressed from 30.88% to 17.26% due to alumina oversupply and price weakness
• Power and fuel cost rose 35.6% QoQ, indicating input cost pressure
• Alumina spot prices (~$300/ton) are below management's guided ~$320/ton, with segment margin likely to remain under pressure
• Auditor emphasis of matter on wind PPA revenue non-recognition since 2019 remains unresolved