ICICI Securities has maintained a Hold rating on National Aluminium Company (NALCO) with a target price of ₹395 in its research report dated May 02, 2026. According to the brokerage's analysis, the stock is valued at 6.5x FY28E EV/EBITDA multiple. The recommendation reflects cautious optimism about the company's near-term prospects while acknowledging potential challenges from upcoming capital expenditure requirements.
NALCO's Q4FY26 EBITDA of ₹23.4 billion came in 4% below ICICI Securities' estimate, as reported by the brokerage. The underperformance was attributed to lower alumina volumes and realisations that offset gains from higher LME aluminium prices. Despite the mixed quarterly results, the company's performance trajectory remains dependent on commodity price movements and the timely completion of strategic projects.
The company has announced ambitious expansion plans involving a capital expenditure of ₹300 billion over the next 3-4 years to establish a 500Kte pa aluminium plant along with a 1,080MW (270*4) power plant. As reported by ICICI Securities, this massive investment could potentially shift NALCO from its current cash-positive position to a net-debt position. The upcoming 1mtpa alumina refinery is expected to be commissioned by Q2FY27, with the full impact of these expansions becoming visible only in FY28.
Looking ahead, NALCO's performance is expected to be influenced by commodity price movements and the timely completion of strategic projects. According to ICICI Securities, Q1FY27 appears positive due to improved LME aluminium realisation, though these gains are partially offset by soft alumina pricing. The brokerage's target price of ₹395 reflects a balanced assessment of the company's growth potential against the significant capital expenditure commitments required for its expansion plans.
