NMDC cuts lumps and fines prices for the first time in eight months: CNBC-TV18 newsbreak confirmed

CNBC-TV18 had reported earlier about NMDC having undertaken a price cut after iron ore prices corrected by 25% globally.

Iron ore is among the weakest performers among major commodities. The slump has been driven principally by concerns about demand in China, where officials are battling a prolonged crisis in the nation’s steel-intensive property sector. Against that backdrop, some mills have been reducing production.

Holdings of iron ore at ports in China — the world’s biggest importer — have been building up, pointing to ample supplies. Inventories swelled to 140.9 million tons two week ago, the highest level in more than a year.

Brokerage firm Citi also spoke about an imminent price cut from NMDC with global iron ore prices having corrected by the company's prices remaining unchanged so far.

Currently, domestic prices are at a 25% premium to the export parity, according to Citi's note.

Every ₹100 per tonne change in the prices of fines impacts NMDC's EBITDA by nearly 4%, the brokerage said.

As a result, the brokerage maintained its "sell" recommendation on NMDC and cut its price target on the stock by 16% to ₹180 from ₹215 earlier.

Shares of NMDC are trading 0.7% higher at ₹207.30.