NALCO shares in focus on JV with NLC India for 1,080 MW thermal plant in Odisha

Shares of state-owned National Aluminium Company Ltd (NALCO) and NLC India will be in focus on Thursday after the company said that it has entered into a joint venture agreement with state-owned NLC India Ltd (NLCIL) to set up a 4x270 MW (1,080 MW) captive thermal power plant at Angul in Odisha.

The two public sector companies signed the agreement on Wednesday, July 8, to incorporate a joint venture company for the project. The proposed entity will be jointly owned, with NALCO and NLC India each holding a 50% equity stake following its incorporation.

The captive power plant is being developed to meet the electricity requirement of NALCO's 0.5 MTPA aluminium smelter expansion project. As part of the arrangement, the partners will also explore long-term sourcing of 200-250 MW of firm renewable energy (RE-RTC), along with long-term coal supply.


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Under the agreement, the joint venture company will sign a 25-year Power Purchase Agreement with NALCO for 100% power offtake under Section 62 of the Electricity Act, 2003. It will also execute a Fuel Supply Agreement with NLC India for coal at Coal India's notified prices.

NALCO clarified that it currently does not hold any stake in the proposed joint venture, which will be incorporated after the agreement takes effect. The company added that both partners will have equal representation on the board of the new entity.

The company further said that NALCO and NLC India are government-owned enterprises functioning under the administrative control of the Ministry of Mines and the Ministry of Coal, respectively. It also noted that the transaction does not qualify as a related-party transaction since dealings between two government companies are exempt under the Companies Act, 2013.

Last month, NALCO said it expects revenue to increase to around Rs 19,000 crore in FY27, supported by steady aluminium prices, higher production from its new alumina refinery and normalisation of costs.

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Chairman and Managing Director Brijendra Pratap Singh had said the company expects aluminium prices to stabilise at around $2,900-3,000 per tonne, with demand remaining healthy despite concerns over additional global supply.

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