 "Vedanta")
Vedanta (VEDL) reported consolidated net sales of ₹40,500 crore, up 14 per cent year-on-year (Y-o-Y) and 3 per cent quarter-on-quarter (Q-o-Q).
Consolidated operating profit was ₹11,500 crore (up 31 per cent Y-o-Y and 3 per cent Q-o-Q), driven by higher volumes, despite input inflation.
The operating profit margin was 28.3 per cent, flat Q-o-Q and up 360 basis points Y-o-Y.
Adjusted net profit was ₹3,500 crore, up 122 per cent Y-o-Y and down 2 per cent Q-o-Q.
VEDL has filed the second motion petition with the NCLT, seeking approval to proceed with the demerger.
The management anticipates that the process will be completed by September 2025. Debt at Vedanta Resources (VRL), the parent and holding company of VEDL, has decreased to $5 billion (the lowest in a decade) and leverage at group level is two times from 2.7 times a year ago.
The FY25 revenue was ₹1.53 trillion (up 10 per cent Y-o-Y), with operating profit at ₹42,300 crore (up 39 per cent Y-o-Y), and adjusted net profit at ₹13,600 crore (up 176 per cent Y-o-Y).
Net debt was at ₹53,300 crore, with net debt/operating profit held at 1.2 times end FY25 (1.4 times in Q3FY25).
Segment-wise, aluminium net sales stood at ₹16,000 crore (up 29 per cent Y-o-Y and 4 per cent Q-o-Q) with operating profit of ₹4,700 crore (up 55 per cent Y-o-Y and 3 per cent Q-o-Q).
While cost of production (CoP) increased 11 per cent Y-o-Y, VEDL produced 603 KT of aluminium in Q4, registering 1 per cent Y-o-Y growth and 2 per cent Q-o-Q decline.
Hindustan Zinc’s Q4FY25’s revenue was ₹9,090 crore (up 20 per cent Y-o-Y and 6 per cent Q-o-Q) with growth driven by high metal production, strong zinc and silver prices, stronger dollar, and hedging gains.
Operating profit was ₹4,820 crore (up 32 per cent Y-o-Y and 7 per cent Q-o-Q). The cost of production for zinc dipped 5 per cent Y-o-Y. Adjusted net profit was ₹3,000 crore (up 47 per cent Y-o-Y and 12 per cent Q-o-Q).
The Zinc International revenue was ₹1,110 cr, up 75 per cent Y-o-Y and 6 per cent Q-o-Q in Q4FY25.
The operating profit was ₹400 crore, up 14 per cent Q-o-Q in Q4FY25, and CoP was up 7 per cent Q-o-Q (down 25 per cent Y-o-Y). Zinc production was up 52 per cent Y-o-Y and 9 per cent Q-o-Q in Q4FY25.
Copper revenue came in at ₹6,100 crore (up 22 per cent Y-o-Y and up 6 per cent Q-o-Q) in Q4FY25. There was an operating loss of ₹49 crore in Q4FY25, (operating profit of ₹4 crore in Q3FY25).
In Iron, the revenue stood at ₹1,530 crore (down 38 per cent Y-o-Y and 18 per cent Q-o-Q), and operating profit stood at ₹310 crore (down 44 per cent Y-o-Y and 17 per cent Q-o-Q).
Ore production was at 2.1 million tonnes, up 22 per cent Y-o-Y and 25 per cent Q-o-Q. Pig iron production was up 4 per cent Y-o-Y, but declined 5 per cent Q-o-Q. Sales volume declined 6 per cent Y-o-Y and remained flat Q-o-Q.
The management pointed to the high-cost alumina inventory and expects the benefit of lower alumina prices to reflect from Q1FY26.
About 55 per cent of alumina is from captive sources, and this will rise to 65 per cent.
Merchant power could be another potential revenue stream with commissioning on schedule at the Athena and Meenakshi plants.
Most of the land acquisition for the Sijimali bauxite mine is complete while Kuraloi and Ghogharpalli mines are also progressing on track.
Konkola Copper Mine (KCM) is also ramping up. The management is targeting 150 KT production in FY26, with potential upside to 170-180 KT. The mine is expected to be cash positive in FY26.
The target is to maintain growth in earnings, led by capacity increments, and higher value-added products. However, global commodity prices could be weaker, which would impact the company.
VEDL continues to deleverage. Investors will have to monitor the demerger, since the details of that will be crucial.
