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Vedanta profit jumps 48% on rally in metal prices, stable oil & gas production

The company also maintained strong margins across key businesses despite an increase in input commodity prices and power cost.

Vedanta House Q4
Vedanta recorded in annual volumes across key businesses with stable production from oil and gas.

Mining major Vedanta on Thursday reported a 48% year-on-year growth in its consolidated net profit to Rs 7,570 crore for the January-March quarter on the back of a rally in metal prices and stable oil and gas production. The company’s net sales during the quarter rose 41% y-o-y to Rs 39,342 crore, supported by higher sales volume and improved commodity prices.

Operating income came in at Rs 13,768 crore, registering an increase of 51% y-o-y mainly due to higher sales volume, supportive commodity prices and operational efficiencies despite higher cost of production amid input commodity inflation.

For the full year ended March 31, the company’s net profit surged 95% y-o-y to Rs 24,299 crore and it recorded its all-time high revenue of over Rs 1.31 trillion, an increase of 51% y-o-y.

Vedanta recorded in annual volumes across key businesses with stable production from oil and gas. The company also maintained strong margins across key businesses despite an increase in input commodity prices and power cost.

Aluminium production was at a record high with 2,268 KT, up 15% y-o-y, while it had highest-ever alumina production at 1,968 KT, up 7% y-o-y. Zinc India registered highest-ever mined metal production, which crossed the 1-million tonne mark and the best-ever metal production of 967 KT up 4% y-o-y.

In iron ore too, Vedanta had its highest-ever sales of 5.7 million tonne at Karnataka, up 30% y-o-y, with record pig iron production of 790 KT, up 33% y-o-y. The company said it is in continued engagement with the stakeholders for resumption of Goa mining.

Under steel, the company recorded hot metal production of 1.36 million tonne, up 5% y-o-y, while saleable steel production at 1.26 million tonne was up 6% y-o-y. The company commenced commercial production from recently acquired two iron ore mines in Odisha. Ferro Chrome production came in at 75 KT.

Sunil Duggal, chief executive officer, Vedanta, said: “This reflects our relentless focus on volume growth and operational efficiency, underpinned by structural integration and technology adoption. The strong free cash flow pre-capex of Rs 27,154 crore has allowed us to reinvest for growth, further strengthen our balance sheet and continue our attractive dividend pay-out.”

The company’s net debt stood at Rs 20,979 crore as on March 31, 2022, with a sequential decline of Rs 6,590 crore since December 31, 2021. Net debt to Ebitda at 0.5x was the lowest in five years, while net debt to equity stood at 0.25x. The company reported strong liquidity position with total cash and cash equivalent at Rs 32,130 crore. The finance cost during the quarter increased 1% y-o-y to Rs 1,333 crore as one-time charges paid on Vedanta Aluminium loan were broadly offset by lower average borrowings and decreased cost of borrowings.

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