MOIL Limited

MOIL reported a decline in its financial performance for the nine months ended December 31, 2025. Total revenue decreased by 9.05% YoY to INR 1,126 crores from INR 1,238 crores in the previous year. Profit After Tax (PAT) also saw a significant drop of 34.21% YoY, settling at INR 175 crores compared to INR 266 crores in 9M FY25. This profitability pressure was largely attributed to a fall in Net Sales Realization (NSR), which management noted is not directly controlled by the company and is influenced by external market factors like steel demand and LME prices.

MOIL is pursuing ambitious growth targets, aiming to increase its manganese ore production to 3.5 million tons and its market share to 32% by 2030, up from the current 20%. The company is investing INR 664 crores in new shaft sinking projects across Dongri Buzurg, Kandri, and Chikla mines to deepen underground operations. The high-speed shaft at Balaghat is expected to be operational within the next six months, with a long-term goal of reaching 8 lakh tons of production capacity over 5-6 years. Additionally, MOIL plans to increase its Environmental Clearance (EC) limits to 5 million tons to support higher production volumes.

To enhance operational efficiency and reduce costs, MOIL is actively transitioning towards greater mechanization and outsourcing. The company's employee count has decreased from approximately 6,000 to 5,200, with a strategy to further reduce permanent staff through increased outsourcing. MOIL is also changing its mining method from the labor-intensive conventional cut and fill to the more productive long-hole open stoping. These initiatives are expected to reduce the cost of production per ton from INR 5,500 in FY25 to around INR 5,300 in FY26, mitigating the impact of future wage revisions.

Addressing its inventory of lower-grade manganese ore, MOIL is implementing a multi-pronged strategy including beneficiation, agglomeration, and exports. The company anticipates a 50% growth in low-grade sales this year and has successfully exported three shipments, including a 60,000-ton parcel. MOIL is exploring setting up its own beneficiation units and committing bulk volumes to partners to add value to these lower-grade materials, thereby converting 'waste to wealth' and improving overall realization.

MOIL demonstrated a strong commitment to capital expenditure, achieving its highest-ever investment of INR 321.94 crores in FY25. For FY26, the company has a capex target of INR 600 crores, with INR 325 crores allocated for domestic mine modernization and INR 275 crores earmarked for overseas acquisitions. The FY27 capex target is set at INR 800 crores. In terms of shareholder returns, MOIL declared two interim dividends totaling INR 5.33 per share and highlighted an impressive average Return on Equity of 161% over the past decade, having returned approximately INR 3,500 crores to investors in the last nine years.

Global manganese ore prices are significantly influenced by external factors, including inventory levels at Chinese ports and logistics disruptions. Management noted that Chinese port inventories have decreased from 6 million tons to 4.3-4.4 million tons. Recent price increases were attributed to supply chain issues, such as the South32 mine incident in Australia and Transnet rail allocation problems in South Africa. While MOIL's prices are typically 5-6% higher than imported prices for domestic customers due to lower logistics costs, the company remains exposed to the volatility of the global commodity market.