The state aluminum producer Nalco has activated its large-scale expansion plan worth 30,000 crore rupees. This plan includes the construction of a new smelting unit with a capacity of 0.5 million tons per year at the existing Anugola complex, the creation of a coal cogeneration power plant with a capacity of 1080 megawatts (MW), and the development of bauxite and coal mining projects.
The projected investments are distributed as follows: approximately 18,000 crore rupees have been allocated to the smelting unit project, and 12,000 crore rupees to the power plant. The launch of additional smelting unit capacity is scheduled for 2030. The company has partnered with NLC India Limited to implement a thermal cogeneration power plant with a capacity of 4×270 MW in Anugula.
Company Priorities
At the annual general meeting on Monday, Nalco's Chairman of the Board, Brijendra Pratap Singh, stated that the primary tasks will be stabilizing and increasing the output of the fifth stream of alumina at the beneficiation plant, launching bauxite mines in Pottangi, increasing coal production capacity, and boosting renewable energy, in addition to the planned expansion of the aluminum smelting unit and the power plant.
Nalco's total raw material production capacity will increase to 3.1 million tons per year because the fifth stream of the beneficiation plant in Damandjodi will add one million tons per year to the current capacity of 2.1 million tons. A project worth 5,677.4 crore rupees has already entered the commissioning phase; testing and trials are being conducted in stages since June, and production stabilization is expected in the fourth quarter of the financial year '27.
The expansion of the beneficiation plant is supported by an active effort to ensure bauxite supplies. The Pottangi bauxite mine in Koraput, with a capacity of 3.5 million tons per year and estimated reserves of 111 million tons and a projected lifespan of 32 years, is planned to be commissioned during the financial year '27. The project is valued at approximately 2,577 crore rupees, and Nalco has separately provided a 25-year contract for the mine developer and operator (MDO) worth about 5,000 crore rupees, excluding GST, for the development and operation of the mine and associated infrastructure.
Singh noted that 'the beneficiation plant expansion project has made significant progress. Key permits have been obtained, detailed design and procurement work has been completed. A lease agreement for the Pottangi mine has also been signed, relevant permissions have been received, and the mine developer and operator have been appointed.'
Before the Pottangi mine begins full operation, Nalco will use an alternative supply scheme for bauxite from the Panchpatmali South block. A crushing and transportation system with a capacity of 3.15 million tons per year is being developed to deliver it to the beneficiation plant in Damandjodi. By July, the project reached about 93 percent physical progress and is scheduled to be commissioned in October.
The company is also strengthening its energy security. The Utkal D&E coal mines in Anugula produced 40 lakh tons during the financial year '26, which were fully supplied to Nalco's cogeneration power plant. The company plans to increase the total production capacity from 40 lakh tons to 48 lakh tons per year, subject to obtaining permits.
Singh emphasized that 'simultaneously we will continue to strengthen our capabilities in critical minerals, advanced materials, circular economy, digital transformation, and clean energy,' signaling that Nalco's expansion strategy goes beyond simply increasing traditional capacities.
As part of diversification, Nalco is involved in overseas development of strategic minerals, including lithium exploration in Argentina through Khanij Bidesh India Limited (KABIL), a joint venture with Hindustan Copper and MECL. Domestically, the company is engaged in extracting gallium from Bayer liquor, as well as mining rare earth elements, titanium, and scandium from red clay.
CMD Nalco reported that 'KABIL and CAMYEN, Argentina, signed an agreement for the exploration and development of lithium blocks in Argentina; non-invasive exploration is complete, and detailed exploration is currently underway.'
Referring to forecasts from the Commodities Research Unit (CRU), Singh noted that the global aluminum market is predicted to remain in a deficit of about 0.35 million tons in 2026. Low inventories and constant demand from the renewable energy, power transmission, automotive, infrastructure, and manufacturing sectors provide fundamental support.
However, production recovery in the Middle East, increased exports from China and Indonesia, energy prices, and geopolitical events are expected to maintain price volatility in the near term. The alumina market, conversely, is forecasted to be in a surplus of about 1.6 million tons this year. He added that prices may tighten starting from the fourth quarter of 2026 due to potential production cuts at some beneficiation plants.
The average global price of alumina (API) for 2026 is forecast at $327 per ton, and the average LME aluminum price for the calendar year is expected to remain in the range of $3,200–$3,300 per ton. From July to August, prices traded in a wide range of $3,100 to $3,300 per ton.
In India, the demand forecast remains favorable and is expected to continue growing steadily. In the first quarter of the financial year '27, the country produced 1.08 million tons of aluminum against consumption of 1.32 million tons.
In the financial year '26, Nalco achieved record levels in bauxite mining—7.7 million tons, alumina hydrate production—2.3 million tons, calcined alumina—2.27 million tons, cast aluminum metal—472,000 tons, coal production—4 million tons, and net electricity generation—6,953 million units.
Furthermore, in the financial year '26, the company achieved record operating revenue of 17,843 crore rupees (a 6% year-on-year increase), EBITDA of 8,613 crore rupees (a 9% year-on-year increase), and profit after tax of 5,816 crore rupees (a 9% year-on-year increase).
Singh added: 'Nalco also demonstrated strong growth while maintaining a healthy balance sheet and a solid cash position. The total dividend payout for the financial year '26 amounted to 2,112.12 crore rupees, equivalent to 230 percent of paid-up capital. The total cash dividend payout for the financial year '26 was 2,020.29 crore rupees, representing a 10% year-on-year increase.'