Best Metal Stocks in India (2023)

Last Updated on Sep 5, 2023 by Anjali Chourasiya

Best metal stocks in India  – Updated September 2023

Note: The data is from 5th September 2023. The following parameters are used on the Tickertape Stock Screener to get the list of metal and mining stocks in India –

• Sector: All metals and mining stocks
• Market Cap: Set to Mid and Large-cap
• 5Y Average Return on Investment (ROI): Sort from high to low
• Fundamental Score

A brief on the filters used to discover the top metal stocks

Market capitalisation: It refers to the total value of the company’s outstanding shares. Companies with a market capitalisation of more than Rs. 5,000 cr., and less than Rs. 20,000 cr., are known as mid-cap companies. And companies with a market capitalisation of more than Rs. 20,000 cr., are known as large-cap companies. These are well-established companies with a prominent market share. 

5-yr average ROI: It refers to the returns that you have earned from your investment in the last 5 yrs. ROI gives an overview of how your investment has performed against market standards, helping you make informed investment decisions. It is usually used to gauge the profitability of projects.

Fundamental score: Fundamental Score is a smallcase proprietary score between 1 and 10 assigned to stocks listed on the NSE. The score helps rank the stock over other stocks in the respective sector. The higher the score, the better the company. The score is calculated considering factors like valuation, profitability, market share growth, financial health and earnings growth of the company.

Details of the top 3 metal stocks in India

Coal India Ltd

Founded in 1975, Coal India Ltd (CIL) is the single largest coal producer in the world. CIL is a Maharatna company – a privileged status conferred by the Government of India to select state-owned enterprises in order to empower them to expand their operations and emerge as global giants. Currently, the company has ten fully owned subsidiaries. Here’s a brief about the company’s financial performance as viewed on Tickertape asset pages.

• As per the Tickertape Scorecard, CIL is undervalued compared to the market average. The stock is showing good signs of profitability and efficiency. There are no red flags found, and the stock is in the overbought zone. Further, the company’s financial growth has been moderate for a few years.
• When looking at the quarterly income statements of the company, we found out that the total revenue for this quarter increased by 3.97% y-o-y, net profit decreased by 9.76% y-o-y, and EBITDA decreased by 9.02% y-o-y. 
• An interesting thing about the stock is that it has matching revenue growth, net income growth, debt-to-equity ratio, current ratio, and free cash flow growth to the industry average.
• Jumping to the Forecasts tab, the company has higher return expectations of 8.96% from the current price level, more than the last 3-yr CAGR of 8.34%. However, the revenue growth and earnings per share expectations are lower than their last 3-yr respective growth parameters.

Click here to analyse the stock further.

Hindustan Zinc Ltd.

Incorporated in 1966, Hindustan Zinc is India’s largest and world’s second-largest zinc-lead miner and 6th largest silver producer globally, with an annual capacity of 800 MT. Hindustan Zinc’s operations comprise lead-zinc mines, hydrometallurgical zinc smelters, lead smelters, pyro metallurgical lead-zinc smelters, as well as sulphuric acid and captive power plants in northwest India. Here’s a brief about Hindustan Zinc Ltd as analysed on Tickertape.

• The Ticketape Scorecard suggests that the stock shows good signs of profitability and efficiency. However, it lags in performance, valuation, and growth parameters; the stock is overvalued and lags behind the market in financial growth. The stock has a moderate number of red flags. It is underpriced and not in the overbought zone.
• When looking at the quarterly income statements of the company, we found out that the company has decreasing total revenue, net profit, and EBITDA. 
• Over the last 5 yr, the company’s free cash flow growth has been 10.39%, vs the industry average of 9.99%, and the current ratio is 305.45%, vs the industry average of 287.69%. However, the company’s debt-to-equity ratio, revenue growth, and net income have been reduced than the industry average.
• When looking into the Forecasts tab, we discovered that the company has lower return, revenue growth, and earnings growth expectations.

Analyse the stock based on your preferred parameters and compare it with its peers here.

NMDC Ltd

Incorporated in 1958 as a Government of India public enterprise, the National Mineral Development Corporation (NMDC) is the single largest producer of iron ore in India. It is a Navratna Public Sector Enterprise under the Ministry of Steel, Government of India. NMDC is considered to be one of the world’s low-cost producers of iron ore. 

All NMDC mining complexes have been rated 5 Star by the Indian Bureau of Mines, Ministry of Mines, which is a testimony to its scientific and sustainable mining practices. NMDC envisages having an iron ore production capacity of 100 MT by FY 2030. On the financial front, here are some insights into the stock.

• As per the Tickertape Scorecard, NMDC is moderately valued compared to the market average. The stock is showing good signs of profitability and efficiency. There are no red flags. The stock is in the overbought zone and lags behind the market in financial growth.
• When looking at the quarterly income statements of the company, the total revenue increased by 15.79% y-o-y, net profit increased by 14.30% y-o-y, and EBIDTA for this quarter increased by 11.90% y-o-y.
• Over the last 5 yrs, the net income, debt-to-equity ratio, current ratio, and free cash flow growth have been increased. However, during the same period, the company’s revenue growth has averaged 14.17%, vs the industry average of 16.24%.

Click here to analyse the stock further.

Metal and mining sector in India 

Here are a few facts about the Indian metal and mining industry:

• India is the world’s second-largest crude steel producer, with 120 MT of crude steel produced in FY 2022.
• India is home to 1,303 mines, which produced 95 minerals – 4 fuel-related, 10 metallic, 23 non-metallic, 3 atomic, and 55 minor minerals.
• India is the second-largest producer of coal. The total coal production in the country stands at 448 mn tonnes as of October 2022, which is 18 % higher than the production of the corresponding period of last year.

India has a fair advantage in production and conversion costs in steel and alumina and has a strategic location near fast-developing Asian markets. Moreover, India’s metals and mining industry is expected to witness a major improvement in the next few years, owing to Government initiatives such as the Make in India Campaign, Smart Cities, Rural Electrification, and a focus on building renewable energy projects under the National Electricity Policy as well as the rise in the infrastructure development.

Growth drivers of the Indian metals and mining industry

• Cost advantage in steel and alumina production-conversion
• Unexplored mines – only 20% of the total reserves of the mineral have been mined till now.
• Rising demand – There has been an increase in demand from the infrastructure and transportation sectors, primarily because of schemes such as Housing for All by 2022 and the expansion of the railway network.
• Supportive government policies
• Unified clearance portal – To start a coal mine in India, there is a single window clearance platform that facilitates the grant of clearances and approvals required.

Future projections of the Indian metal and mining industry

• The steel industry has significant growth potential and aims to achieve the target of 300 MT by 2030.
• The actual production of crude steel is forecasted to reach 255 MT by 2030-2031.
• Domestic stainless steel consumption is expected to rise from 72.3 kg in 2021 to 160 kg by 2030-2031.
• Coal is projected to remain India’s largest single electricity source in 2040.
• The Government plans to monetise assets worth Rs. 28,727 cr. (US$ 3.68 bn) in the mining sector over FY 2022-2025.

Conclusion

India’s metal and mining industry is expected to bloom in the coming years. To keep an eye on the top metal stocks in India, you can use Tickertape Stock Screener. It is loaded with over 200 filters, pre-built screens, custom filters, and so much more. You can sort the best metal and mining stocks based on your preferences and export the list in a CSV file or save the screen for future reference. Tickertape Stock Screener makes your analysis smooth and the investment process quicker. You can directly invest from the platform by connecting your broker account. Yes, it is as easy as it sounds. Don’t wait. Analyse and invest! 

FAQs

• What are metal stocks?

Metal stocks refer to companies related to the metal industry and mining products, such as aluminium, iron, gold, silver, steel, and copper. India’s top metal and mining companies are Coal India Ltd, Hindustan Zinc Ltd, NMDC Ltd, Vedanta Ltd, and Lloyds Metals And Energy Ltd.

• What is a nifty metal index?

The Nifty Metal Index reflects the behaviour and performance of the metal sector, including mining. The index comprises 15 stocks listed on the National Stock Exchange (NSE). 

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Anjali Chourasiya

I am a finance enthusiast who loves exploring the world of money through my lens. I’ve been dedicated to building systems that work and curating content that helps people learn.

As an insatiable reader and learner, I’ve spent the last two years exploring the world of finance. With my creative mind and curious spirit, I love making complex finance topics easy and fun for everyone to understand. Join me on my journey as we navigate the world of finance together!

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