National Aluminium Co.Ltd. (NSE: NATIONALUM) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Bharat Sahu — Company Secretary
Subha Brata Purohit — National Aluminium Co.Ltd.
Brijendra Pratap Singh — Chairman-cum-Managing Director
Jagdish Arora — National Aluminium Co.Ltd.
Analysts:
Unidentified Participant
Amit Murarka — Analyst
Aditya Welekar — Analyst
Saket Kapoor — Analyst
Presentation:
operator
Good morning everyone. On behalf of Systematics Group we welcome you to the 1QFY26 earnings conference call of Nalco Limited. We are joined today by Sri Pijay Pratap Singh, CMD and Director, Commercial and other functional Directors of the company. Along with Mr. Bharat Sahu, company Secretary. Discuss the company’s financial and operational performance for the first quarter FY26. I would like to thank the management for giving us an opportunity to host this call. At the end of the presentation we will open the floor for questions. And participants can raise their hands if they wish to ask a question.
Now I request Mr. Bharat Sahu for his opening remarks and introduction of the management team. Over to you, sir.
Bharat Sahu — Company Secretary
Thank you, ma’. Am. Greetings from National Aluminium Company limited To all our esteemed investors. We had a board meeting yesterday to consider and approve the Q1 2526 results. The result is already out. And thank you Systematics Group for arranging and hosting this post earning conference call. Before we start, let me have the privilege of introducing our management team, the functional directors. Anti clockwise sitting extreme is the Simon Panda, our Ed Finance. Sitting next to him is our Sri Abe Kumar Beoria, Director Finance. Next to him is Sri Jagdish Aroda, Director of Projects and Technicals. Sitting in the middle is our CMD and Director Commercial Additional Charge Sri Vijay Pratap Singh Sir.
Sitting next to him is Sri Pankaj Kumar Sharma, Director Production. And sitting just next to me is our director HR Dr. Tapas Kumar Patnaik. And before taking any further time first we’ll have a brief presentation about the Q1 results. And then we’ll invite our esteemed participants to come forward with their questions. Now I’ll request my colleague Mr. To have the presentation please.
Subha Brata Purohit — National Aluminium Co.Ltd.
Thank you sir. Good morning to all. Welcome you all to this earning conference call for quarter one. So the result of Q1 has been published yesterday. And it’s another quarter of strong results shown by the company. Now we’ll go through the presentation. The agenda of the presentation is similar to the earlier presentations. Look at the company at least. Then we’ll go to the physical performance, the financial highlights. Then we’ll touch upon little bit on the industry’s outlook. And we’ll see our business highlights of the company and the ESC performance of the company as well. Integrated Bauxite Alumina Aluminum power core complex in the country and it is global leader in producing Oxide and alumina at the lowest cost.
We are the lowest cost producer since about seven to eight years. We have been continuously rated as the lowest cost producer in bauxite and our assets. Bauxite assets are at bauxites and refining assets are at Damanjori. It’s 7.5 million we are producing right now bauxite as per the requirement of our refinery. Our refinery capacity is currently 2.1 million and CPP assets are at anhood Again in the state of again in the state of Odisha. We have also recently started operating our local E and E coal mines. In January of 2025 our combined capacity of 4 million tons started then.
We have a dedicated facility at Baizak Port for export of alumina also import and metal and import of products. We are also having four wind power plants of one total 198 megawatt capacities and Rajasthan Bar and and now coming to our physical performance in quarter one we have been operating at almost about 100% capacity but still we are improving our productivity and still registering higher production quarter by quarter. So if you see in case of bauxite we have achieved 6.6% growth against corresponding quarter last year. In case of alumina hydrate there is there has been a significant jump of 35% against quarter one due to base effect.
Then in case of metal we have achieved 3% growth and power also 6% growth come to sales also in sales also in case of alumina we have achieved significant jump. This is partly due to basic fact as Q1 sales were a bit less and in case of metal also we have achieved growth of 9%. Here I would like to mention also that in case of domestic sales of metal and alumina in both case we have achieved highest ever since quarter one of any particular year and if you see the run rate also we are exiting our past year productions.
So in case of alumina we are running at a run rate of around 23 lakh ton. Aluminum we are running at 4.6 to 4.7 and bauxite also around 76. Now coming to the financial performance in the Last quarter the Q4 of 2425 Record making performance of the company the last quarter and the last financial year as well in Q1 also the company has shown very strong performance in its results. We can see there is growth of 33% in the revenue and also the pack has registered growth of 77% against the corresponding quarter of last year.
The company has also declared dividends of rupees 2.5 per share in its latest golden day. Now coming to the industry outlook, the LME price there was a downtop in April 25 when LME price fall down to $2,380 per ton because of the direct announcement by US President. Since then the LMA price has recovered and it has reached about $2,560. Right now the energy price going ahead are likely to be impacted by the tariff developments are still uncertain though the 90 days period has elapsed. But still there are lots of negotiations to go and it’s the tariff rates are far from over.
So the developments the enemy price also will depend on the latest developments on the tariff of US announcements. Then there are new starts in aluminum refining and smelting capacities primarily in Indonesia and India. Then of course there is rising oil prices and increase in US dollar index recently the LME price normally moves inversely with the rising oil prices and with the rising dollar index. Actually the LME price moves indexly. So the LME prices will be impacted and there is disruptions in the bauxite supply. Also guinea has cancelled some licenses recently for bauxite mining in Ghana.
Also there is one lease where the license was cancelled. So upon developments in these sectors the LMA price will also be impacted. Now coming to the global GDP growth in earlier outlook in April 2025 IMF has projected 2.8% growth. But this time in July 2025 the tariff related developments has settled a bit as per IMF and they have projected a growth of 3% which others well for the aluminium sector as well. Because aluminium consumption is almost proportional or to the growth of the country as well as the globe. The IMF is projected that there will be 3% growth in 25 and 3.1% growth from the year 26.
Coming to the alumina scenario, the aluminum alumina supply was a bit of downside on the last year. But the supply has improved recently and we can see the difference between production and consumption. It is coming as little bit on the surplus side the aluminum prices are also moving accordingly coming to the aluminum sector. In aluminum sector there is growth, there is little bit of deficit on the if you see the quarter on quarter basis and on the year estimation for the annual. Also there are management of deficit sites. So the aluminum sector is also dependent on the latest capacity additions.
We all know that the capacity at China is gapped at 45 million ton currently. So currently China is almost about reaching the 43,44 million tons. So the supply side will be limited to that so in the H2 of this year and the next future years the LME prices are likely to stay strong. Now if you look at the domestic scenario, the domestic our country is still the fastest growing economy in the world. Recently RBI has said that for this year we are projecting at 6.5% growth. For the next year 6.7% growth. The country is to be by the year 2047.
So to reach a 30 trillion economy by 2047 the growth rate needs to be more than 7% which again others well for the aluminum industry in the country. If we see the aluminium consumption pattern, the currently the electrical sector is having the largest chunk in the aluminum production. It is having around 48% share and transportation and building and comes next. So as the country’s indeed growth rises there will be definitely growth in this sector. And recently our Ministry of Mines has published aluminium where they have predicted aluminium conduction will reach about 8.5 billion ton by 20.
So there is lots of scope for improvement of demand in the country. And if you see the Indian aluminum scenario also the growth rate is about 9%. The aluminum consumption growth is around 90%. And also there is growth in the production. So the sector is a moving sector in the country. And the primary producers are also adding capacities to their plants. So this is strategy is it’s an integrated operations. We are integrated with our five mines, our alumina refining capacity, our power plant. Then also we are having our own captive coal block. The company is a zero debt company which gives leverage to fund our upcoming projects.
Our smelter and power projects which will require a huge investment. So zero debt position will help the company of security. In case of caustic soda, we are having a heavy company with GSEMS which is supplying caustic soda to the company. Then our refinery capacity is going ahead. The smelter capacity also is on the pre project stages at the moment. If you see our expensive plants currently going ahead, the bauxite mines we are currently running at 7.5 million ton. And we have already signed the lease deed for Patangi bauxite mines which will be operated by this year and or by quarter one of the next year.
So our capacity will increase by 3.5 million ton. Then we are going ahead with our extreme refinery expansion which will increase the capacity by 1 million tons. The mechanical completion is targeted by this year, this financial year and the execution are currently on fast track mode. We have achieved around 74 to 75% progress, physical progress in this and captive power plant. These are at the three project stages and the plants are likely to become by financial year 30. Now coming to the environment part, the company is recognized for its works in the environment management. Our bauxite mines are rated as Piper mines.
Recently we are operating two bauxite mines Bridges Central and North clock and south clock at Panes. Both these oxide mines has been recently rated as P rating. We are putting equally emphasis on plantation waste utilization, pollution control measures and biodiversity protections. We are also certified with all the international management certification like ISO 14001, ISO 5001, ISO 9001 and like. And also we are operating. Already I have told that we are operating 190 megawatt wind power plant. We are also utilizing our rooftop solar places. Currently the capacity is 1020 kilowatt power and we have planned to add 7 megawatts rooftop solar in the future.
We are also equally responsible to the society we are working in. We have identified important sectors where we are working. The company is working at Damanjuri and Angur. Damanjuri is one of the most tribal tribal resided population. So we are focusing on education where we have some paxist schemes like Indira Dhanush where we are sponsoring students. Students mostly to reported residential school. We have also a scheme of Nalco Ki Latin which is in line with government of India’s movement where we are providing financial assistance to the girls of DGF families in case of healthcare. We are operating mobile healthcare engines.
Huge numbers of mobile health units. And also Patanji where we are serving to people of 250 peripheral villages. And we are serving more than 1 lakh patents annual. Also we are operating one OPD facility at Ankur where we are serving 18,000 for women empowerment. We are helping groups like Saka foundation for their livelihood support. Then there are lots of works on peripheral development. Also we have adopted the Puri Temple and surrounding areas development works. So these are the all the areas where we are working as per our social obligations, our corporate governance, the company, the Government of India company.
So we are maintaining all our statutory requirements. There are 10 board level committees. We are having 17 core policies and guidelines. We have been rated as very good in the year financial year 2424 25. Also we have been recognized for our fair treatment to investors, our dividend policies and transparency in our reportings. So thank you all. My presentation is over now.
Bharat Sahu — Company Secretary
Thank you. Yes ma’. Am. We. We have already made a brief presentation on the Q1 as well as the different activities of the company. Now we may allow our esteemed participants to come forward with their questions to the management please.
Questions and Answers:
operator
Thank you sir. We now open the floor for questions. Anybody who wishes to ask a question can indicate that by using the hand icon button. So till then I’ll proceed with a couple of questions from my side. So first question would be the status of the alumina refinery and what is the status, what is the progress and when are we now expecting the commissioning to happen? And post that what is likely the ramp up plan and what can be the expected volumes Post commissioning in FY27 and 20 it.
Brijendra Pratap Singh
As far as refinery is concerned. First of all a very good morning to all to you and everyone. All everyone connected here. Very good morning to all and congratulations to all for the wonderful performance of Nalco in Q1. As far as your question is concerned for 5th stream refinery expansion, whatever commitment we have given earlier that we’ll be starting the commissioning, all mechanical jobs will be completed maybe by March and we will try to start all commissioning thing after that and try to start the production by June 26th. That is the commitment which we have given earlier also and we stand by it.
The progress in the site is good. All the packages are working well. So when this refinery comes maybe we start the commissioning in production in June 26th. So Next Financial year we are hoping we will be producing at least 50% of the total capacity. Because initially the production will be less maybe around 5 lakh to 6 lakhs. There’s a 10 lakh capacity line. You’ll be producing around 5 lakhs next year. Next financial year that is 26, 27. After that it will go to the rated capacity of 10 lakhs.
operator
And so what, what is the number that you can see from the existing alumina like you were earlier and we are seeing growth in alumina sales. So from the existing one, what kind of capacity utilization are you expecting on the existing capacity?
Brijendra Pratap Singh
Existing capacity almost we are over utilizing. Our. Our production capacity of alumni is 22.5. Around around 22 lakhs or 22.5. This year we are planning to do more than that. Maybe 23 lakhs. We will be doing so we will be doing 100 of the rated capacity of the existing line. More than 100.
operator
Understood sir. Thank you. We’ll take our questions now. We have first question from Amit Vararkas from Access. Amit, please go ahead with your question.
Amit Murarka
Yeah. Hi. Thanks for the. Thanks for the hosting, the call and the opportunity to ask the question. So on alumina generally like we have been Reading that the U. S Russia is, are engaging for de escalation of the current situation uh in Ukraine and that could prompt uh, the, the removal of the export kind of restrictions on Russian alumina. So how do you read the situation? What’s your expectation of Russian alumina coming back to the market? Because I believe that could kind of, that could create maybe an overall supply situation. So just wanted some view on that.
Brijendra Pratap Singh
Russian. As far as Russian you are talking about Russian alumina or aluminium?
Amit Murarka
Yeah, like alumina as well. So both. Both rather. But yeah, like
Brijendra Pratap Singh
I don’t, I don’t think excess of alumina is there. Of course aluminium is there. Aluminum which there they were sending to Europe. Europe is already has imposed the sanctions on Russia. So Russian aluminum is not able to go into the European market. And with the Indian Prime Minister signing a free trade agreement with UK a lot of opportunities are there with Indian aluminium industries to go into the UK market. Because UK market is a again market where there are a lot of potential for increase in evs, solar panels and other where usage of aluminum will be there.
So that will be a boost for Indian aluminum industry as far as UK is concerned. As far as US tariffs are concerned, again that is a concern area. US tariff increased to around 50% from 25%. But our aluminium which is especially from Nalco, we are not exporting any of the aluminum as of now. We are most. Our all aluminum is getting consumed in the domestic market. So Nalco will not be affected by that. Of course Vedanta was exporting aluminium to UK USA so that may come down if the tariffs is going to remain at the 50 level.
But still the demand is there in US also. So they might go in taking aluminum with the higher prices also.
Amit Murarka
All right, so specifically on Russian supplies, like how, how much supply would have been impacted of aluminum. Let’s say if you have any numbers. Or in your mind
Brijendra Pratap Singh
Russian supplies of.
Amit Murarka
Aluminum in the global markets.
Brijendra Pratap Singh
Russian supply of aluminum to the global market. I don’t think I have the figure right now. You’ll have to check what, what amount of aluminium Russia is exporting.
Jagdish Arora
Russia is. What he is asking is alumina. Alumina Russia was.
Brijendra Pratap Singh
How much aluminium Russia is exporting.
Jagdish Arora
So aluminium they have around 1.5 million ton, 1.3 total 4 million. They, they were not producing it. They have reduced it to. They have reduced it to just half million ton. They had curtailed so and that they are not the lowest cost of producers. The lowest cost of producers are EGA or this Emirate Global and Bahrain they will be the first sufferers. This aluminium trade anything which is coming down from America, they are the most supplier to America. They were supplying 100 to America. So they will be the first sufferers. Bahrain and ega, this is Dubai based companies.
Amit Murarka
And the secondly on the coal supplies of your captive coal mining, I think you mentioned that the 4 million ton has started. So how much would you would you have produced in Q1 of the captive minds?
Brijendra Pratap Singh
Q1 almost at the rated capacity we are producing as far as our targets are there. And this year we’ll be doing around 4 million 10 will be completing.
Amit Murarka
Okay, so during monsoon then you don’t anticipate any issue around with coal supplies, right? I think it earlier. In earlier years we have seen some.
Brijendra Pratap Singh
That is not there. That is not there. No, no, no. Supply disruptions are there. We have a sufficient stock of coals in our power plants and in mines also. Mines also we are having sufficient stocks. During monsoon some interruptions in the production is there. Mines production is there. But the dispatches the transportation from mines to our power plant that is going as per requirement because we have sufficient stock in the mines.
Amit Murarka
Sure. Thank you so much. I’ll come back later in the queue then.
Brijendra Pratap Singh
Okay, thank you.
operator
Thank you. We’ll take the next question from Kartike Karthik, please unmute yourself and go ahead with your questions.
Unidentified Participant
Hi. Am I audible?
operator
Yes, you’re audible.
Unidentified Participant
Yeah. Thank you for the opportunity. So. So I have. I actually missed a couple of points from the starting. So I just wanted to understand what. Are the timelines for the new bauxite and aluminia bauxite mine and the alumina refinery. And like what’s the cost of production. In the alumina refinery? We are expecting.
Brijendra Pratap Singh
As far as bauxite mines is concerned, we are planning to already tender is out for MDO and we are planning to start the mine somewhere maybe February, March latest by June we are planning but we are early with our all dates. Maybe latest by May. June will be starting the bauxite mines, Potangi mines and alumina refinery. Fish stream. As I already said, we are planning to start the commercial production from maybe June 26 onwards. As far as cost is concerned, cost of the alumina produced in this new our new system refinery expansion that will be almost similar to the cost which we are producing now.
Because of course interest interest is not there. We are not taken any loan for that depreciation will be loaded. But that will be made offset by the technology in this the technology is a better technology where the caustic soda consumption will be on the lower side. Manpower will be on the lower side. Overall manpower. Because here in a single line we will be producing around 10 lakh tons. Now with four lines at present we are producing 20 lakh tons. So that advantage of the volume will be getting with a lesser manpower. Because manpower is the most costly thing which is our fixed cost as far as fixed cost is concerned.
So cost will be almost similar kind of as far as what we are incurring now as far as alumina is concerned. Okay sir. And just I wanted to know what was the alumina realization for this quarter? Aluminum reduction for this quarter was around 35,000. It was around $400. 416. 416. $416 average.
Unidentified Participant
Okay sir. And sir, just another question. Like what drove the other expenses for this quarter? As the the other expenses were quite high. So I just wanted to understand
Brijendra Pratap Singh
other expenses. Of course what you are telling is 707 crore is on the higher side. I think RPO obligation is on the higher side. You can just deliberate on that rpo. My director production or maybe my ed Finance. We had some RPO obligations as far as renewable power is concerned which costed around 70 to 75 crores. That was the additional cost which we paid. Because the norms, government norms has changed.
We have to have 30. 30.
Unidentified Speaker
Basically our work project is basically so. We were earlier having our RPO obligation of around 3% of our electricity. Now due to the ministry of guidelines for year 2425 we are bound to have obligation of around 29.4% for the year 2425 and 33% for the year 2526. So in that connection we have this e certs for around 75 crores for the year 2425. That has increased the cost
Brijendra Pratap Singh
and some orbital programs. 70 crore was that 70? 75. And what is the other? There is an increased in repair, maintenance and the core transfer which was 7.2 lakh in the earlier. Now this quarter it is 9.89 lakh.
So the. In our presentation of accounts the transport portion of coal is captured in the other expenses not in power and fuel. So that also has added to around 1210 to 12 crore rupees. So these are the major things and little bit of in CSR expenses and RPO obligation then general administrative expenses increased by around 8 crores. No, that is in interest and due to higher volume movement of alumina from refinery to smelter. There Is an increase in transportation cost also. And a higher export of alumina also that has increased selling distribution expenses.
Unidentified Participant
Okay. Okay. Thank you. Thank you so much.
Brijendra Pratap Singh
And because of there was a little estimation change in last accounting.
operator
Thank you. We’ll take the next question from Aditya Velikar. Please go ahead.
Aditya Welekar
Yeah. Thank you. Am I audible?
operator
Yes. Please go ahead.
Aditya Welekar
Yeah. So just on the fifth string of alumina refinery. Sir, what kind of means? In the last call you have guided on volumes of 5 lakh ton from that in FY27. So we are keeping it that guidance unchanged. Correct?
Brijendra Pratap Singh
Yes. Yes. In FY27 we will be aiming for 5 lakh tons from that. Because if you are able to start in June that that much volume will be getting.
Jagdish Arora
Yeah. Nine. Nine months.
Brijendra Pratap Singh
Nine months will be there. These are 10 lakh capacity. Three quarters minimum five lakhs. You should give.
Aditya Welekar
Just related to that. So once once the plant stabilizes what kind of utilization can we expect post the full ramp up.
Brijendra Pratap Singh
Utilization? Actually initially if you start in June initially some utilization will be on the lower side. But slowly maybe within next six months we’ll be trying to take it to the rated capacity of 10 lakh tons. It will take maybe 3, 4, 5, 6 months. But since it is only a chemical plant. Chemical process plant. So it will not take a lot of time. That’s why we are taking 5 lakh tons for financial year 27.
Aditya Welekar
Understood. Just on few numbers in the last call we have given alumina sales volume guidance of 12.8 lakh tons. Out of which 12.3 are exports. So those numbers are also unchanged. Right?
Brijendra Pratap Singh
This year you are talking for this year 26.
Aditya Welekar
FY26.
Brijendra Pratap Singh
This year that will increase. Our exports will increase. Whatever we have done last year, Last year we have done around Kitna shipment. If we talk in terms of shipment 36 shipment. This year we are planning for maybe 41 or 42 shipments. 42. That will increase by maybe five shipments. The five shipment around one one lakh or one and a half lakh.
Aditya Welekar
So what will be?
Brijendra Pratap Singh
Because we are increasing the volume overall production volume will increase.
Aditya Welekar
And what will be that? Sir, Total production volume guidance for this year.
Brijendra Pratap Singh
Last year we have done. Last year calcined alumina. We have done around 20.7. It was around 20.7. This year we have planned for 22.5. But we are aiming key will be achieving around 23. Maybe around two or two and a half lakh tons more of production will be there. So in domestic market we are also increasing Our presence last year we have sold around 40000 in the domestic market. This year we are planning to will be selling around maybe 1 lakh or 1 lakh 20000 in the domestic market. And the rest will go to the exports.
So export maybe around 1 lakh or 1 lakh. 50000 will increase.
Aditya Welekar
Okay. So total sales volume will be 12.8 lakhs.
Brijendra Pratap Singh
It will be. It will be around more than 12.5 lakhs. 1.5 lot 8 lakhs.
Aditya Welekar
Understood sir. My last question is on that Brownfield smelter of 0.5 million ton. Any progress on the DPR? In the last call we said that we we can file a revised tprs.
Brijendra Pratap Singh
As far as expansion of mentor is concerned. Already DPR preparation activities we have started. For DPR preparation we have to have a consultant. Already appointment of consultant. We are going ahead that within maybe next two months or three months will be two months we’ll be having consultant two, three months. And he will be there for preparing the dpr. We are planning next maybe seven, eight months we will be ready with the DPR to take it to the board for the approval. What is the timeline? Yeah. Our director project is here. You will further clarify it for this.
Jagdish Arora
This month or this financial year will complete all the DPR preparation and all the activities. And one good thing is that that land acquisition which was held up that has taken shape. And we have completed all the all the formalities of land acquisition. And now the final stage of land acquisition has is taking place. So which will be completing in another four to six months. And by this time our all the preparation would be ready. So next financial year we’ll start the tendering process and onboarding the parties.
Aditya Welekar
Understood sir. Thanks a lot. I’ll get back in the queue.
Brijendra Pratap Singh
Thank you.
operator
Thank you. We’ll take the next question from Srikanth. Please go ahead.
Unidentified Participant
Yeah. Hi everyone. Can you hear me?
operator
Yes.
Unidentified Participant
Yeah. Yeah. Hi. Hi. This is Srikanth from hsbc. Thanks for the opportunity to ask questions. Three questions. For the time being I’d like to take them one by one. So first one is how much of alumina sales in this quarter were on a spot basis and how much were under long term contracts.
Brijendra Pratap Singh
Whatever we have sold in export market every month one shipment is going for long term and the rest is going on spot. On an average 4 shipment per month we are doing exports.
Unidentified Participant
Okay. Understood. My second question is on pricing. So for long term contracts how is pricing determined? Is it linked to LME Aluminium prices.
Brijendra Pratap Singh
Yes. It is linked to the LME prices in that some percentage is decided on that percentage it is decided we do it under tender basis. Whoever the tender is going giving the maximum percentage on the LME that is order is given on that.
Unidentified Participant
Okay, that’s very clear. And third, what is management’s outlook for alumina and aluminium cost of production. And can you just remind us about the cost of production in Q1?
Brijendra Pratap Singh
20,000. As far as cost of production is concerned. AB I will request my data.
Unidentified Speaker
So far as the cost of production of alumina is concerned and our cost of production is varying around 20 to 21,000. The total cost so far the cost of production of alumina is concerned. So our cost of production is variance between 20,000 to 21,000 and out of that is 60% is our variable cost and balance is fixed.
Unidentified Participant
Okay. And what’s the outlook for this year?
Brijendra Pratap Singh
Pardon?
Unidentified Participant
What is the outlook for this year?
Brijendra Pratap Singh
It will be almost. It will be similar kind.
Unidentified Speaker
Similar kind. Because of our techno economic performance. Very good. We expect reduction in our cost because our performance parameter has improved. Well the key consumables, caustic soda. The other parameter. We have a great control over that. So we expect that our cost will come down at the end of the year.
Unidentified Participant
Okay, this was very helpful. I’ve got couple more questions but I’ll come back later. Thank you.
Brijendra Pratap Singh
Thank you.
operator
Thank you. We’ll take the next question from Saket Kapoor. Please unmute yourself and go ahead.
Saket Kapoor
Thank you for the opportunity.
operator
Your voice is a little distant. Can you come closer to the mic?
Saket Kapoor
Yeah, yeah, yeah. Now am I audible, sir?
operator
Yes, it’s much better.
Saket Kapoor
Namaskar to the entire team and thank you for the elaborate discussion we are having sir. And we hope for the continuity sir, on the value added product. If you could just throw some light. What is our roadmap going ahead and how will value added sales will contribute? I think so. Some investment in the Angul park was also envisaged earlier. So where are we, what are we going to invest? When are we going to see value added contributing to the top line and bottom line? If you could just give us a roadmap
Brijendra Pratap Singh
as far as value added product is concerned. Our focus now is increasing the production of wire rods. Because wire rod we are producing only around 1 lakh tons per year yearly. So we are trying to get one new wire rod mill so that our whatever ingots we are selling in the market that we will be able to control our country convert into wire rods.
That is one target. We are Taking already DPR has been made earlier. For that we are revising the cost estimate and going in for tendering. The whole activity may take around two years for the mill to come. And next is the foil sector, the aluminium foil. In that area also we are trying to have some kind of presence where we are going in for appointing one consultant will be suggesting us what kind of oils to be made, what will be the market and all that. And very small investment is required in that maybe around 150 to 200 crores of investment is required.
So these are the two areas. As far as aluminium is metal is concerned. Where we are targeting next two years or three years, two and a half years we should have presence increasing our wire rods and foil segment from our roll product units and even roll product units we are going to have an annealing furnace which is coming in the March. So road product units may on an average we are producing 2,000 tons per month. That will increase to 3,000 tons per month from March onwards. So that area also will give more value added product from roll product units.
As far as alumina is concerned, there are the two areas as is special grade alumina, fused alumina. These are the areas we are evaluated we can make. Also we are exploring the market for that. What kind of market is there? The market is there for that. We’ll be going in for maybe some kind of conversion or setting up our own units. That is also in there in our mind. You have to go in for that.
Saket Kapoor
So how much have we outlined for this one? The firstly the buyer, the wire rod part two years timeline which you have said how much we will be spending on the same and what would be its revenue contribution? Sir, as on today market pricing
Brijendra Pratap Singh
as far as. As far as wire rods is concerned we get a premium of around 10,000 in wire rods. If you see the contribution, the contribution difference is around maybe 5,000 to 6,000. Because the conversion we take the conversion cost into account. Raw products we see we get a premium of around 3235000 in in the range of depending on the project product. But contribution again there is. I think contribution must be around. It must be around 6 to 7,000 contribution as far as roll product is concerned. So contribution is there in both road product and wire rods. And more importantly is that because if you are selling ingots we are heavily dependent on the lme.
So if you want to insulate ourselves from the lme the fluctuations of the LME and get the premium in the market it is very important that we going for increasing the volumes of wire rods, road products and also going into the foil markets. Oil market again has a very good contribution margin.
Saket Kapoor
My question was what is the capex we are doing to for the wire rod segment for aluminum foil? You mentioned 1 to 2
Brijendra Pratap Singh
capex. As far as capex of the wire rod mill is concerned it is around in between 200 to 300 crore for a capacity of 1 lakh ton mil For a setting a foil plant again it is a very low capex plant.
Around maybe 50 crores or 60 crores for a maybe thousand ton monthly capacity plant. Depends on the capacity what we are setting the wire rod will cost around maybe 250 to 300 crores. That is the capex as far as wire rod is concerned.
Saket Kapoor
And last point sir on the, on the alumina realization. So what are the current spot market realizations? And for and and for this quarter and the ensuing quarter at what prices have we contracted our shipment? If you could just give some color on that.
Brijendra Pratap Singh
As far as current spot prices are concerned that is averaging around 400 this first quarter was.
We got around 416 was the average because some last quarter balance size quarter. May I shipment that order was of the higher wall rate. But whatever spot prices currently we are getting is somewhere around $400 and we are expecting that in the coming quarters also that will remain somewhere in between 400 to 450.
Saket Kapoor
Right sir. Thank you sir. We will. I will join the queue and all the best to the team.
Brijendra Pratap Singh
Thank you. Thank you.
operator
Thank you. We’ll take the next question from Pallavagarwala. Please go ahead.
Unidentified Participant
Yeah. Good morning sir. So I had a question on how the aluminum physical premiums have been moving. So is it more linked to the NJP or. You know since we sell a majority of our products in the domestic market so we should be probably commanding a better premium compared to our peers.
Brijendra Pratap Singh
Talking about the premiums in the metal sector.
Unidentified Participant
Yeah,
Brijendra Pratap Singh
that addressed that. I was telling earlier also as far as premium is concerned, wire rod in wire rods we get a premium from our ingot around 10,000. And our conversion cost if you see it’s around I think 3,500 to 4,000 rupees traditional benefit of around maybe 6,000 or 7,000 we get in wire rods as far as virod is concerned depending on the quality and grade of the virus we are producing as far as rolled product is concerned we get a premium of around in between 30 to 35,000 extra premium.
But of course conversion cost is also there. So if we See margins, extra actual margins. After conversion cost, it will come around maybe 5,000 to 10,000 in between, depending again on the what product we are talking about sizes and all that. If you are going in the more lower sizes, 0.3mm, 0.5mm, the premium on the higher side. But our productivity goes down. If you are producing on the thinner side, the productivity goes down and the volume comes down. We have to balance in that.
Unidentified Participant
Yes, we’ve also seen, you know, competitors also trying to push more material in the domestic market.
So is that, is there enough demand to absorb that? So physical premiums can sustain at these levels.
Brijendra Pratap Singh
Domestic market what we are seeing in the consumption pattern of the aluminum in the domestic market, around 45 to 50% is going into the power sector. Now the kind of infrastructure development, the kind of power lines, grid lines and government thrust in the electrification is there. The demand will be there as far as power sector is concerned. Now solar panels, lot of solar panels are there Again extrusion demand is there in solar panels. Lot of solar panels are coming.
EVs, electric vehicles again in EVs. Lot of usage of aluminum being a lightweight replaced by the steel. So all these areas, infrastructure, other areas, infrastructure development. Also lot of the demand in the domestic market is still there. Because you are seeing the domestic GDP growth is around maybe 5 to 6% growth GDP which is projected. And aluminum, as far as whatever historically we see aluminum requirement is around 1.5% of the GDP is almost there. It grows like that. So aluminium requirement will grow at the end of maybe 7 to 8% or 9%.
Unidentified Participant
Lastly, you know, you know, you mentioned that we incurred almost 75 crores in RPO obligations.
So are we planning on putting up, you know, captive solar or maybe increasing the wind power capacity so that we don’t have to purchase. We can reduce the external RPO purchase.
Brijendra Pratap Singh
Yes, of course we have to do that. We are going in for appointment a consultant in a very this planned manner. Already 7 megawatt solar power is under our tendering stage. That will come within next one year or one and a half years. But that is a small quantity. Wind power is an area where we have to see or maybe setting up in hybrid mode.
Wind and solar both we are exploring on that. Maybe our plan is by 2030, next four, five years, we will have to have more of at least 15 to 20% of green power into our portfolio. Yes, our director project will supplement.
Jagdish Arora
This is a very good question. And going forward everybody and we are working on it in different format and very soon we’ll have a fixed plan that how much green would be coming. And as our CMD service told this 10 megawatt of solar will come in one year. But another 10 megawatt of our wind power will come in one or two months. Because in Kaitar it is ready now it is being getting clearances in maybe from September or October we will be. Having 10 megawatt of additional plant. And we are working on a hybrid around the clock combination of solar, wind and battery storage. And all we are working on with all the producers, power producers and another three, four months time will be fixing up our roadmap for the next few years.
Unidentified Participant
Also sir, I mean with the captive coal now at 4 million tons is there any incremental cost savings that can come in or. You know most of the benefits are now already in the pnl.
Unidentified Speaker
There is a saving because what we are taking coal from MCL on full supply agreement and our own production there is a difference of around 400 rupees. You are getting advantages and transportation cost also because that our minds is very proximate to our cpp. So that advantages we are also getting. The both of you are getting advantages in our in house coal supply.
That is from our own mice. Okay.
Unidentified Participant
Okay. Thank you.
operator
Thank you. I’ll take the next question from Manav Bhogia. Please go ahead.
Unidentified Participant
Yes. Hi. Very good morning and thank you for the opportunity.
Brijendra Pratap Singh
Good morning.
Unidentified Participant
So you had mentioned the cost of production of alumina at 20 to 21,000 rupees per ton. Can you provide the same for the aluminium segment as well?
Brijendra Pratap Singh
Aluminum our cost is around150.
Unidentified Speaker
155 to 160. It is varying within that range. Only the aluminum product because that is depend upon our product basket. I am talking about the average cost of metal. The more we go for old product the cost may vary but the range is within 155 to 161 lakh. 50,000. 1 lakh 55,000.
Unidentified Participant
Sure.
So got it. So one question. If you could provide the number for the landed cost of the caustic soda for the quarter.
Brijendra Pratap Singh
I think it was something. Soda landed cost was
Unidentified Speaker
44,000. Something
Brijendra Pratap Singh
44,000. Plus it has increased slightly. It has increased from the previous quarter. 41,000. 44,041. You see the landed cost of caustic soda in if you see quarter one 24242425 it was 36300 this quarter. This year 2526 it is 44 301. So it has increased. If you compare Q1 last year. If we compare Q4 last quarter. Say if you compare then that cost has gone I think 3021. Q4 Q1 sir, against 41.
So it is increase, is there?
Unidentified Participant
Sure, sure sir.
Brijendra Pratap Singh
44,000 is the price which we are getting now.
Unidentified Participant
Got it. Thank you so much. That’s all from my end and all the very best.
Brijendra Pratap Singh
Thank you.
operator
Thank you. We’ll take the next question from Srikant Heman. Please go ahead.
Unidentified Participant
Yeah, thanks again for the opportunity. Three more questions from my side. So first is what is our total coal requirement and how much of this still needs to be purchased externally?
Brijendra Pratap Singh
Total coal requirement is around 7.2 million ton. So we are. We’ll be producing around 4 from our internal and 3.3-3.2 will be taking from coal India.
Unidentified Participant
Understood. Very helpful. Second is regarding our bauxite mines. So when do the leases for the existing mines expire?
Brijendra Pratap Singh
Our data production is there. Basically our we are presently we are operating two mines and the variety present variety is in 29 and 31 and we will initiate process for renewal also. So this is the situation.
Unidentified Participant
Understood. And the last question is regarding long term illumina contracts. So is it safe to assume that roughly 75% of alumina exports would be on spot and rest would be on long term contracts. Is that understanding correct?
Brijendra Pratap Singh
I think long term will be on the lesser side because we had done one long term tender we did not get sufficient of price was not very good. So as of now we are aiming to go more on the spot. Maybe it will somewhere around 80% spot and 20 long term.
Unidentified Participant
This was very helpful. That’s all from my side. Thank you.
operator
Thank you. A couple of questions from my side as well. So regarding the brownfield aluminum project where you said the DPR is currently ongoing. So we have. We identified a new technology partner since there were certain challenges in the previous. With the previous partner.
Jagdish Arora
Yeah, the new technology supplier, we have already finalized it and in another three, four months. Last time I told the same thing. In three four months time we’ll onboard the new technology supplier.
operator
So the DPR preparation since you said it’s ongoing. So that would be basis finalization of the technology supplier, right? Or is it something which happens after the technology supplier is identified?
Jagdish Arora
I didn’t get your question. Can you come again please see DPR preparation. This technology suppliers input is required. So by the time we are fixing up who will be preparing our dpr this technology suppliers would be finalized and they will be onboarded it. We have almost finalized the things now we are doing the formalities. Being a psu, we, we have to go through a process and very soon we’ll be onboarding the technology supplier.
operator
And so the next question was on the wind. Wind capacity that commissioning that you said 10 megawatt. So this, I mean what platform are we looking at and what is the rated capacity of these turbines? Are we looking at the latest turbines?
Jagdish Arora
It was actually, it was actually a very long project with when went into NCLT. But this now 10 megawatts, 1.5 megawatt is the capacity of each turbine and. Six such turbines would start producing it. So we’ll be. We are getting clearances, all those clearances from MNRE and state of Tamil Nadu in this month. We’ll finalize this and then we’ll start utilizing it. We’ll, we’ll see what, what, how, how the how is the best possibility of utilizing this.
operator
Okay. Understood. I missed. Your missed. I think a participant asked this question. I missed that point. So could you just reiterate what is the export proportion of alumina sales and do I stand correct in understanding that around 75 or 80% of your export sales are in on the spot basis? Right.
Brijendra Pratap Singh
You want to know the volume of export sales as compared to domestic.
operator
Yes. Yes. Alumina.
Brijendra Pratap Singh
If we see this year what I was telling every month maybe four shipment we are doing export. So that comes to around 1 lakh 20,000 in between some some month we are doing 4 shipments some month 5 shipment also average 120. And domestic sale will be around monthly. If it see monthly domestic sale will be around in 20,022 in between 20 to 25,000 maximum 22,000. So that will be around maybe 15 to 20% of 15% of the total volume will be going into domestic market.
operator
Understood. And like 70, 80% of the export would be on spot basis.
Brijendra Pratap Singh
Yes, you get yes, spot. 80% is spot. Maybe 20 will be going on long term contract.
operator
Okay, so that’s it from my side if I don’t. I think we are done from all the participant questions as well. So I hand over to you to the management for any closing remarks and we can just conclude the call.
Brijendra Pratap Singh
Thank you ma’. Am. And thank you all, our esteemed participant analyst and our institutional investors for recruiting confidence on NALCO time and again. And coming in such a huge number with so many of questions giving insight to our production, our marketing activity. It’s also about expansion, diversification activities and we hope and expect the same kind of cooperation in future also. And I just the MIC to our CMD sir just to close the investor once again on behalf of everyone present here, all our directors I would like to thank all the investors, analysts and everyone connected through VC for going through Nalco result and being in giving confidence in Nalco.
Whatever your queries, I hope we have explained them well. One thing which I would like to tell on behalf of the our board that as far as NALCO is concerned, alcohol performance. We are trying to increase the volumes. We are trying to improve our techno economics as far as market is concerned. Every time market is not in our hand, the prices, the demands are not in our end. What is in our hand is to increase the volume, maximize the production and increase the techno so as to reduce the cost that already we have taken very challenging target this year as compared to previous year we have taken at least maybe 10% higher targets in all the areas.
And in as far as first quarter is concerned we have achieved all those targets. We are very much sure we will be achieving those targets. So at the end of the year the financials will be very good. What advantage we have, we have both upward and downward integration. Upward integration. May we have our own bauxites mines where we’re getting very good quality bauxite. Sufficient quantity of bauxite. Now we are having our own coal mines from where we at least maybe 60% of coal we are getting which is again giving advantage to us. We are having JV with genial for having caustic soda that is again giving a security as far as caustic soda is concerned.
Our power plant as far as power security is concerned that is our own captive power plant where we produce the power at the rate of maybe 3 to 3.5 or 3.10 rupees per unit. That again is giving advantage to us. So a lot of advantages as far as our total integration is concerned. Now we are going in for expansion mode. The refinery will come next year. Our target now is to expedite the expansion of smelter along with the power plant that we are aiming to next three to four years. It should come so that whatever alumina we are producing, excess of alumina should be converted to aluminum.
So after that only this overall turnover of the company will go above 25000 to become a mar company. That is our target and with all the things going, we are hoping whatever we are planning, we’ll be able to do it. So thank you once again in having confidence in Nalco and sharing all your experiences with us. Thank you. Thank you very much.
operator
Thank you, sir. Thank you for hosting the call and thank you, all the participants for joining in. We now conclude the call.
Brijendra Pratap Singh
Thank you. With this, we come to an end of this session. Thank you all. The question is.