• National Minerals Development Corporation (NMDC) has a good exposure to the iron ore mining sector with large reserves of high-grade ore, assured demand from the expanding Indian steel industry, production costs that are far below the global average and large cash in its coffers to pump into diversification and expansion projects.
• NMDC enjoys a near monopoly status in the Indian iron ore mining sector, with iron ore making up nearly all of its revenues.
• The company's diamond mine at Panna is one of the largest diamond mines in Asia. That apart, it has exposure to other minerals such as limestone, dolomite and manganese which are captively used to produce iron ore.
• NMDC has seen a compounded annual production and sales growth of 20-25 per cent between FY05 and FY09.
• NMDC's Indian market focus lends high stability to its revenue, given the strong steel demand in the domestic market and the expansion plans of domestic steel majors.
• The company's impressive operating profit margins of 70-80 per cent, its zero debt status and cash of over Rs 12,000 crore on its books (as of December 2009), make the stock a preferred exposure in the listed mining space.
• With the ongoing expansion in the steel industry and a bulk of customer contracts soon due for renewal, NMDC may witness strong revenue growth of 25-30 per cent in the next couple of years.
• To keep pace with the growth in the steel industry, NMDC plans to expand its iron ore production capacities to 50 million tonnes by 2014-15.

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