Vedanta slips after weak Q1 results

Vedanta fell 4.24% to Rs 157.10 at 10:06 IST on BSE after the company's consolidated net profit fell 11.9% to Rs 1,351 crore on a 3.5% decline in net sales to Rs 21,167 crore in Q1 June 2019 over Q1 June 2018.

The result was announced after market hours on Friday, 26 July 2019.

Meanwhile, S&P BSE Sensex was down 69.21 points or 0.18% at 37,813.58.

On BSE, 3.04 lakh shares were traded in Vedanta counter, compared to a 2-week average of 5.74 lakh shares. The stock hit an intraday high of Rs 165 and an intraday low of Rs 156.60. It hit a 52-week high of Rs 246.90 on 3 October 2018 and a 52-week low of Rs 145.90 on 15 February 2019.

Revenue in Q1 was lower primarily due to lower commodity prices partially offset by higher aluminium sales, volume addition from ESL, commencement of Gamsberg mine and currency depreciation.

The firm's EBITDA fell 20% to Rs 5,188 crore in Q1 June 2019 over Q1 June 2018, mainly due to lower commodity prices partially offset by easing of input commodity inflation, rupee depreciation and volume addition from ESL acquisition. EBITDA margin stood at 27% in Q1 June 2019 as against 34% in Q1 June 2018.

The company reported a total cash & liquid investments amounting to Rs 30,774 crore in its Q1 June 2019 results. Its gross debt stood at Rs 59,517 crore, down by Rs 6,708 crore in Q1 June 2019 over Q4 March 2019.

Vedanta informed about its structured investment at Cairn India Holdings (CIHL), which was entered as a part of its cash management activities, has yielded a net cumulative gain of $100 million within a period of 8 months. The cash proceeds from the settlement of the transaction will be paid to CIHL on 13 August 2019.

Vedanta's CEO, Srinivasan Venkatakrishnan, said "We continue to strengthen our position as one of the largest diversified natural resource businesses in the world with our strategy focused on value-added growth. Our businesses stayed resilient in a quarter with low commodity prices and uncertain market environment and we continued to ramp up across the key verticals, Zinc & Oil & Gas. Silver is outperforming as we climb up the ranks among the top global silver producers. Aluminium business is steadily moving towards its target cost. We are also pleased with the superior returns that have been achieved with the unwinding of the structured investment transaction at CIHL for the benefit of all shareholders of Vedanta. We look forward to exciting quarters ahead as we continue to deliver for all our stakeholders."

Vedanta is a natural resource company engaged in the business of manufacturing copper and copper products, aluminum and aluminum products.

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