vedanta ltd share price Management discussions


Global Economy:

The global economy faced several challenges in CY 2022, starting from the initiation of the

Russia-Ukraine war, supply chain disruption, high inflation, and high key policy rates by the central banks. Global inflation remained a matter of concern in most of the economy, which reached a multi-year high of 8.7% in CY 2022. Monetary tightening by the central banks across the world helped bring the trajectory downwards. The unwinding economic events weighed down global economic growth prospects. World economic growth in CY 2022 is estimated to have declined from 6% in CY 2021 to

3.4%, as per IMF.

Commodity prices eased the early gains of

CY 2022 amidst supply chain issues and Chinas

Zero Covid policy due to the demand slowdown. Metal prices, however, stabilised following Chinas reopening and measures to revive its economy and retracing inflation in advanced economy like USA and EU.

Europes fight against the repercussions of war

Europe was significantly impacted by the war, which led to high energy and food prices created by the supply-chain disruption. This stretched the purchasing power of the consumers while also impacting the manufacturing sector, that led to production cuts. In Q4 CY 2022, the energy crisis improved, supported by high gas inventory levels, favourable weather conditions, and the central banks monetary policy tightening, which eased inflation. IMF estimates the Euro area to have grown by 3.5% in CY 2022[1]. The monetary tightening is expected to limit the GDP growth in CY 2023 to 0.8% before increasing to 1.4% in CY 2024.

US Economy strong against recession fear

Inflation in the worlds largest economy soared to a 40-year high, mainly driven by low labour participation and supply-chain crisis influenced by the external environment. The subsequent monetary tightening by the Federal Reserve Bank impacted the countrys economic growth. Rising fed rates led to a further strengthening of the US dollar, thus stretching the current account deficit of import-dependent countries. Despite the negative outlook, the US economy has performed better than expected. The inflation level which reached 9.06% in June 2022 declined to 6.04% in February 2023[2]. The US economy grew by 2.1% in CY 2022 but is expected to decelerate to 1.6% in CY 2023 and 1.1% in CY 2024 [1].

Central Banks Interest Rates (%)

Chinas reopening to drive global economy

The Chinese economy dealt with multiple challenges in CY 2022, including the real estate sector slowdown, severe COVID-19 infection, and its mitigation with Zero-COVID Policy. Unlike other countries, its central bank loosened the monetary policy to encourage domestic growth, in addition to the stimulus package to boost consumption. Chinas manufacturing activity after facing a slowdown in CY 2022 with a growth of 3% is coming out strong and is projected to grow by 5.2% in CY 2023 and 4.5% in CY 2024 [1].

Global Economy Outlook:

Performance of the global economy was better than earlier projections, given the lower-than-expected severity of the Russia-Ukraine war and high energy prices. Manufacturing PMI, which fell below the 50-level mark is moving up in most economies. Chinas re-opening has further improved the expectation of increased economic activities, generating positivity for the global economy. Inflation levels in most of economies peaked, but expected to fall to 6.6% in CY 2023, improving global financial conditions and business sentiment.

Indian Economy:

The Indian economy performed exceptionally well compared with the rest of the world. India is set to retain its bright spot in CY 2023 with a potential to contribute 15% to the global GDP growth, according to IMF.

In December 2022, India also assumed G20 presidency with an ambition to unite the world under the theme ‘Vasudhaiva Kutumbakam" or "One Earth ? One Family ? One Future". This is an opportunity to showcase the nations global leadership amidst growing uncertainty and economic crisis.

Indias manufacturing sector also outperformed the rest of the world, projecting the country as a potential manufacturing hub. Stable political conditions, supportive policy schemes, strong domestic consumption and growing presence of skilled professionals support this ambition. Indias manufacturing PMI remained above the 50-level mark through the year, indicating positive performance.

Indias export, including services and merchandise touched US$750 billion in FY 2023 supported by robust policy implementation by the Indian government. GST collection also reached 18.1 trillion, a year-on-year growth of 21.4% in FY 2023[6]. Other economic indicators like non-food credit, automobile sales and electricity consumption have also registered robust growth. These indicators are well-supported by consumer sentiment indices, which witnessed consistent monthly year-on-year double digit growth[6].

Indias rising retail inflation was of concern. Fiscal stimulus support and additional monetary support resulted in the CPI level crossing RBIs upper tolerance levels. Sustained vigilance and multiple rate hikes by the RBI, resulted in repo rate increasing from 4% to

6.5% in February 2023. This significantly controlled the CPI level; from a peak of 7.8% in April 2022 [7], it reached below the upper tolerance limit in November and December of 2022, before reaching 6.4% in

February 2023 [8].

Policy initiatives by the Government of India (GoI)

The GoIs focus to make the country an attractive destination for business has been a key enabler of robust economic performance. The capital expenditure allocation of 10 lakh crore for FY 2024, an increase of 37.4%, YoY, has been an exceptional step. The approach towards infrastructure development and inclusive growth of the country is setting the foundation for multiple years of strong growth.

The World Bank has emphasised the collaboration between nations to boost global GDP growth in the current decade. GoI has taken steps in this direction, establishing bilateral trade relations through Free Trade Agreements with Australia and UAE, vastly expanding the market for domestic manufacturers. The upcoming negotiation with the UK, EU, and GCC nations are expected to further expand the horizon. As India aspires to be the global manufacturing hub, these trade deals will ensure a smoother transformation of the global supply chain. The removal of export duty on iron ore above 58% Fe grade and steel has encouraged the sector to have global competency amid commodity volatility.

The National Logistic Policy, another ground-breaking policy initiative by the GoI targeting the complex logistic system, is likely to make India more efficient in project implementation. The plan to reduce logistics cost from 14% to less than 10% is expected to expand the scope of government spending and streamline government operations.

Indian Economy Outlook

Although global projections of economic growth for CY 2023 loom on uncertainties, India on the other hand is expected to outperform. As per IMF, Indian economy is projected to grow at 5.9% in FY 2024[1] after having grown at an estimated 6.8% in FY 2023, to be among the fastest growing major economies. It further projects India and China to contribute to half the global growth in CY2023. Indias economic growth will be driven by robust domestic demand supported by the governments continued thrust on infrastructure spending. However, external challenges of global economic slowdown, geo-political scenario and energy price uncertainties may keep the Indian economy vigilant.

Indias growth outlook by domestic and global agencies


Month of Release FY 2022-23 FY 2023-24
Economic Survey (GoI) January 2023 7.0% 6.5%
RBI February 2023 6.8% 6.5%
IMF January 2023 6.8% 5.9%
World Bank January 2023 6.9% 6.3%
Asia Development Bank (ADB) December 2022 7.0% 7.2%
OECD November 2022 6.6% 5.7%
S&P Global Ratings January 2023 7.0% 6.0%
Fitch Ratings December 2022 7.0% 6.2%
Nomura March 2023 6.6% 5.3%

Source: CMIE


1. IMF, WEO, January 2023
2. U.S. Bureau of Labor Statistics
4. S&P Global
5. World Bank, The Pink Sheet
7. RBI, Monetary Policy Committee




The year kicked off on a positive note with zinc prices hovering around US$4,000-4,400 per tonne (/t) levels as supply chain got impacted amidst the Russia-Ukraine war and Chinas zero covid policy led lockdown. However, the market was subject to volatility throughout the year; zinc prices even touched US$2,682/t level in November 2022.

It closed at US$2,907/t during the end of March 2023.

The global refined zinc demand contracted by 3% to 13.6 million tonnes in CY 2022, largely due to a fall in Chinese demand. At supply level, the refined zinc production fell by 2.6% in CY 2022, due closure of several smelters globally for care and maintenance as the energy prices increased. Consequently, the global zinc warehouse stocks also fell during this period. In FY 2023, the total tonnage of zinc at Shanghai Futures Exchange (SHFE) warehouses and LME fell to 97 kt and 45 kt respectively during the end of March 2023.

Indian refined zinc demand, however, was robust and is estimated to have increased by ~3% in CY 2022 mainly driven by demand from the infrastructure and

Galvanising industry.

Market Drivers

The global zinc demand is expected to grow by 3.5% in CY 2023 majorly driven by stronger offtake from China and India. In India, the zinc demand is expected to increase by 10% in CY 2023 driven by demand from infrastructure and automobile sector.

In domestic market, Indian Railways has been a key demand driver for zinc. With a focus on safety and speed, it has introduced 18 Vande Bharat trains till now (another 478 trains planned) and is also working on different mechanisms to protect rail network from corrosion. Strong focus on developing road, power generation and transmission and 5G related telecom infrastructure are likely to create demand. Together, these are expected to bolster zinc consumption in India.

Products and customers

Hindustan Zinc Limited (HZL) is the largest primary zinc producer in India. In FY 2023, it had 77% domestic market share; it sold ~60% of its refined zinc volume in the domestic market and exported rest of the volume to South-East Asian and Middle Eastern markets.

Over 70% of the zinc demand in India comes from galvanising steel, predominantly used in the construction and infrastructure sectors. HZL has a strong portfolio aligned to these needs comprising continuous galvanising grade, electroplatting grade and two grades of zinc for use in die-casting alloys, which make it an attractive player. The Company is working closely with its customers to increase the proportion of value-added products (VAP) in its zinc portfolio. It strives to increase VAP mix to 23% of total zinc sales in FY 2024, up from 16% in FY 2023.



Historically, lead is believed to be insulated from cyclical demand movements compared to the other metals. However, lead prices in FY 2023, especially during first half of the year, experienced significant volatility. Starting with a 12-month high of US$2,471/t in April 2022, lead prices fell to a 23-month low of US$1,754/t in September 2022. The prices improved in 2H FY 2023 driven by Chinas reopening. LME price stood at around US$2,100/t level at the financial year end.

Global lead market, including primary and secondary markets, saw demand growth of 1.5% to 13.4 million tonnes in CY 2022 compared to 4.3% growth in CY 2021.

Demand outstripped supply and lead inventories fell to historically low levels. In first nine months of FY 2023, lead inventory in LME declined by ~36% to 25 kt and that in SHFE by ~60% to 35.2 kt.

In India, the refined lead market, including both primary and secondary markets, increased 8.2% to 1.2 million tonnes in CY 2023; the primary lead market demand was ~250 kt.

Market Drivers

The domestic refined lead consumption is expected to grow by 4.2% in CY 2023. With faster consumption growth against minimal mine supply growth, the markets are expected to be tight with no surplus.

Increasing urbanisation and industrialisation in developing countries along with rising automotive consumption are expected to be the key drivers for lead demand. In the domestic market, the demand for lead is expected to be robust, largely on the back of continued demand momentum in automotive sector, which witnessed excellent growth in the passenger vehicle and two-wheeler sales in FY 2023. The demand from the industrial battery segment is also expected to remain robust with battery replacements in data centres, banks, ATMs and other critical applications gathering pace. Given Indias ambitious renewable energy focus, emerging areas like energy storage for electricity generated from photovoltaics are likely to add to the demand.

Products and customers

HZL is a leading primary lead producer in India; it produces 99.99% purity lead ingots. In FY 2023, it had ~85% share of the primary domestic market. It sold 91% of its production in domestic market and exported 9% to other geographies. Considering the opportunities in the Indian market, the Company intends to become 100% domestic market focussed through new customer acquisition, leveraging e-commerce platforms and introducing lead alloys.



CY 2022 saw the silver demand reach new highs driven by strong industrial demand, jewellery and silverware offtake and physical investment. The global silver demand rose by 17% in CY 2022 to 1.24 billion ounces (Boz). The industrial demand for silver increased by 2.6% to

550 million ounces (Moz) in CY 2022, driven by vehicle electrification, governments expanding commitment to green infrastructure and rising 5G adoption.

FY 2023 started positively with London Bullion Metals Association (LBMA) silver prices reaching US$24.54 per troy ounce (/toz) in April 2022. However, with the market volatility, the prices declined to US$17.77/toz during September 2022. The prices picked up gradually to reach US$23.75/toz in January 2023 and stood at average US$21.9/toz during March 2023.

Market Drivers

Global silver supply is expected to rise by 4% to 1.005 Boz in CY 2023. Silver mine production is expected to grow by 5% to reach 0.873 Boz in CY 2023, due to new silver mines in Mexico and increased output from Chile gold operations with high silver content. The silver recycling growth is expected to be 3%.

Global silver demand, though, is expected to dip to 1.15 Boz in CY 2023. The decline would be primarily on account of softness in jewellery and physical investment demand. The long-term prospects for silver investments (both physical and ETF) remain strong. Silver coin demand in India is also encouraging. While it has largely been driven by gifting and religious purposes, which insulates it from price fluctuations, its demand has increased in recent years because of the different product offerings and marketing efforts from mints and refineries.

However, global industrial demand for silver is expected to increase by 2.6% to 550 Moz. The solar panel manufacturing industry has been increasingly consuming silver, driven by governments support in terms of production linked incentives (PLI) to promote the usage of renewables. The use of silver for vehicle electrification and creation of charging stations is also likely to rise.

Products and customers

HZL is Indias only primary silver producer and ranks 5th globally among the top silver producing companies.

HZL sells silver exclusively in the domestic market. It is used in industry (electrical contacts, solder and alloys, and pharmaceuticals), jewellery and silverware. The Company also offers spot sales of silver through e-auction to reduce manual intervention, thus ensuring equal opportunity for buyers to compete along with complete price transparency.



The aluminium market during CY 2022 started on a positive note with LME prices steeply rising to all-time high of US$3,849/t in March 2022. However, the market was significantly impacted by volatility in macroeconomic conditions during the year amidst the ongoing Russia-Ukraine war, European energy crisis, and high inflation in the key markets. Consequently, the market witnessed price declines as the year progressed; LME price stood at around US$2,350/t level during the end of March 2023.

In CY 2022, global primary aluminium production increased by 2.5% to 69 million tonnes while demand is estimated to have increased by 0.4% to 69.2 million tonnes resulting in global deficit of 0.2 million tonnes. In China, the largest market, primary production increased by 4.5% while demand increased by 1.2%. In rest of the world (RoW), both production and consumption were flat.

In India, the domestic demand is likely to have surged 17% from ~3.9 million tonnes in FY 2022 to around

4.6 miliion tonnes in FY 2023; majorly driven by primary aluminium demand on robust economic growth with high industrial and manufacturing activities supported by government initiatives.

Market Drivers

Global total aluminium demand is expected to increase at a CAGR of ~3% from 96 million tonnes in CY 2022 to 122 million tonnes in CY 2030 driven by multiple factors. The decarbonisation transition in transportation and packaging industry is expected to push aluminium demand. Aluminium consumption from renewable energy and electric vehicle sectors is expected to increase from 6 million tonnes in CY 2022 to 16 million tonnes by CY 2030.

CY 2023 is expected to witness demand improvements from both China and rest of the world. Chinas primary aluminium demand is expected to increase by 2-3% mainly due to government stimulus policies.

Indian domestic aluminium demand is likely to be driven by key consuming segments like electronics and appliances as well as anticipated boom in renewable, defence, and aerospace sectors.

Products and customers

Vedanta is Indias largest primary aluminium producer with an annual capacity of ~2.3 million tonnes. It has a market share of 41% (as of March 2023) in the domestic market; its domestic sales volume increased by 28% in FY 2023. The Company also has a sizeable OEM base globally that consumes its value-added products.

The Companys product portfolio includes aluminium ingots, primary foundry alloys, wire rods, billets, and rolled products which cater to varied industries globally such as power, transportation, construction and packaging, defence, renewable, automobile and aerospace among others.

In line with the evolving market needs and the focus on value creation, the Company has been steadily strengthening its market position with focus on value-added product (VAP) portfolio which currently accounts for ~38% of its total aluminium sales globally. The Company is working on projects to increase its total aluminium capacity to 3 MTPA and VAP mix to ~100% along with improvement in backward integration.



According to the US IEA, the global oil supply increased by 4.7 million barrels per day (mbpd) to 100.1 mbpd in CY 2022, with the US, Russia and the Organisation of the Petroleum Exporting Countries (OPEC) being the major contributors.

At the same time, the global oil demand increased by

2.2 mbpd, driven by both Organisation for Economic Co-operation and Development (OECD), primarily the US, and non-OECD countries, primarily India, and the Middle East. Indian oil demand increased by 8%.

Crude production and consumption (mbpd)


CY 2021 CY 2022

Change, CY 2021

vs CY 2022
World production 95.4 100.1 4.7
OPEC crude production 26.4 29.1 2.7
World consumption 97.7 99.9 2.2

(Source: US EIA)

Oil market was subject to elevated volatility amidst multiple macro and geopolitical events in CY 2022. This included Russias invasion of Ukraine in late February 2022 and the ensuing sanctions, embargoes, and price cap on its oil imports. Further, recessionary and inflationary pressures on the global economy, Chinas low oil demand due to stringent zero-COVID policies, and the transformed crude and product trade flow also impacted the market. The global oil market adjusted to these shocks and physical supplies were marginally hit. The losses in Russian supplies were limited due to unwinding of OPEC+ cuts, release of oil from the strategic petroleum reserve (SPR), and the ability of Russia to redirect its exports from Europe to other parts of the world. India emerged as a key destination, with share of Russian crude in its overall import basket increasing from 0.2% levels to highs of ~27% in January 2023.

These elevated uncertainties shaped supply demand balance and market expectations, as partly reflected in extreme price movements in CY 2022. During majority of the first half of CY 2022, crude oil prices traded above US$100 per barrel (/ bbl). However, it softened gradually during second half of CY 2022 and returned to pre-Russia-Ukraine war level of US$70-75/bbl by March 2023.

Market Drivers

As per OPEC, the global oil demand is expected to increase by 2.5 mbpd to 101.9 mbpd in CY 2023 with a potential upside coming from the opening of the Chinese economy and increased demand for jet fuel and kerosene. Global oil supply driven by the US, Brazil, Norway, Canada, Kazakhstan, and Guyana are expected to exceed demand during the first half of CY 2023. However, second half of CY 2023 is expected to be oil deficit with demand recovery and continued decline in Russian output due to the sanctions imposed. Nevertheless, large uncertainties remain over the impact of ongoing geopolitical developments, as well as the output potential for the US shale in CY 2023.

According to the US Energy Information Administration (EIA), brent crude oil spot prices will average at US$83 per barrel in CY 2023. Global economic outlook uncertainty and rising crude inventory will impact crude oil prices, however, the pressure will be limited due to high demand from Asian markets.

India, the worlds third largest oil consumer and the fourth largest refiner, currently meets 87% of its oil consumption and 50% of its gas consumption through imports. In CY 2023, Indias demand is projected to increase to 5.39 (+0.02) mbpd, supported by increasing airline activities and projected GDP growth of 5.6%. The governments proposed increase in capital spending will boost construction and manufacturing activities, thereby, driving the oil demand in India.

Products and customers

Cairn India is the largest private oil & gas exploration and production company in India with gross proven and probable R&R of 1,151 million barrels of oil equivalent (mmboe). The Companys crude oil is sold to public and private refineries and its natural gas is consumed by the fertiliser industry and the city gas distribution sector in India.

100% of the Companys crude oil and natural gas production in FY 2023 was sold in India as per government regulation. The Company is focussed on strengthening its dominance in the Indian market, with an ambition of producing 50% of Indias oil & gas.



India is the 3rd largest electricity producer in the world after

China and the US, with an installed capacity of 411 GW, as of

31 March 2023. Energy being an important input for economic growth and development, India has seen rapid growth in electricity demand over the years, in line with its economic development. In FY 2023, Indias total electricity demand grew by 9.5% to reach record highs of 1,511 billion units (BUs) while the total electricity generation grew 8.7% to 1,624 BUs.

There is strong focus on creating new capacities to meet the countrys burgeoning energy demand. The Government of India (GoI) has set a vision to double the power capacity by 2030, to keep pace with the growing population, increasing electrification and per capita usage.

Market Drivers

According to the Central Electricity Authority (CEA), Indias annual electricity consumption is estimated to grow at an average of 7.2% per annum over next five years, driven by expansion in industrial activities, growing population, rising per capita income, and increasing electricity penetration. In line with the demand projections, the countrys installed capacity is estimated to register a 10+% CAGR during FY 2022-27.

Multiple initiatives by the government are encouraging growth and investment in the power sector. This includes policy support such as delicensing the electrical machinery industry, allowing 100% foreign direct investment (FDI) and the focus on ‘Power for All through various schemes. This includes Saubhagya, Integrated Power Development Scheme, Deen Dayal Upadhyaya Gram Jyoti Yojana, Unnat Jyoti by Affordable LEDs for All, Restructured Accelerated Power Development and Reforms Programme, Ujwal DISCOM Assurance Yojana and National Infrastructure Pipeline.

To ensure climate compatible growth, renewable energy is expected to be a preferrable mode with a target to expand its capacity to 500 GW by 2030. PLI scheme and policies like the Green Energy Open Access Rules, Energy Conservation (Amendment) Bill 2022 and renewable energy generation and utilisation (renewable purchase obligations) are incentivising this change. The Union Budget FY 2023-24 has also given due importance to renewable energy with increased capital outlay.

Products and customers

Vedanta has a power portfolio with a total capacity of ~ 9 GW. These power assets are at Talwandi Sabo, Jharsuguda, Korba, Lanjigarh. 37% of the total capacity is used for generating power for commercial purposes, backed by long-term power purchase agreements with state distribution companies of Punjab, Tamil Nadu, Kerala, Chhattisgarh, and Odisha. The remaining 63% power generated is deployed in captive operations at Aluminium and Zinc businesses.

Vedanta has set itself a target to achieve 2.5 GW round the clock renewable energy (RE RTC) capacity by 2030 and has signed power delivery agreements for 788 MW RE RTC by the end of FY 2023.


India is the second-largest steel producer in the world. Steel is one of Indias core industries, contributing more than 2% to the GDP. In FY 2023, Indias crude steel production increased by 4% to 125 million tonnes.

Indian governments continuous focus on infrastructure building has led to an increase in Indian steel finished consumption by 13% to 119 million tonnes in FY 2023. In eastern states, steel demand was relatively higher due to the projects like Hockey World Cup in Odisha and various rail bridge constructions in the North-Eastern belts.

The steel product prices, however, have been volatile.

The domestic long steel prices reached highs of

~70,000/tonne during April 2022, as raw material prices increased following the Russia-Ukraine war. However, with increase in export duty during May-December, 2022, the prices fell as domestic market-focussed producers liquidated inventories. Prices recovered back to 60,000/tonne levels during March 2023 with reversal of export duty, and subsequent uptick in export orders along with improved domestic demand.

Market Drivers

In FY 2024, steel demand in India is expected to be robust. The governments push to increase steel production as per the National Steel Policy, focus to make India a US$5 trillion economy and ‘Make in India policy are likely to support the industry. Demand from the major sectors such as infrastructure (including railways, metros, freight corridors), construction and housing, renewables and automobiles is expected to be strong supported by Union Budget 2023-24s push for infrastructure creation through 10 lakh crore capital expenditure outlay.

Railways have been allocated 2.40 lakh crore with plans to bring 4,000 km of railway network under ‘Kavach, a train protection system, in FY 2024. Further, increased activity in UDAN scheme to construct 100 airports, a higher allocation of 80,000 crore to Pradhan Mantri Awas Yojana and a resurgence in automobile sector (expected to attract 74,850 crore investment as part of PLI scheme) are likely to boost steel demand. Additionally, the proposed import duty reduction for machine parts used to produce Li-ion batteries in electric vehicles, may boost auto industry and hence the steel consumption.

Products and customers

ESL Steel Limited presently has 1.5 MTPA of steel manufacturing capacity, with projects underway to expand the capacity to 3 MTPA in FY 2024. The Companys portfolio includes pig iron, billets, TMT bars, wire rods and ductile iron pipes which are sold across construction, infrastructure, transport, energy.

In FY 2023, the Company developed various new wire rods grades, including Boron Alloy Grades in co-ordination with customers to meet their requirements. It received several notable accreditation approvals, including from UK CARES for TMT. It also secured various domestic approvals, such as blanket approval from the National Highways Authority of India and UP Metro Rail corporation, UP Bridge

Corporation, Satluj Jal Vidyut Nigam, IOC Panipat Refinery,

Jal Jeevan Mission, Water Corporation of Orissa and Rural Water Supply and Sanitation department. The Company further added several esteemed customers to its portfolio, from infrastructure, steel and engineering sectors.

For FY 2024, ESL is prioritising developing value-added grades of wire rods, increasing alloy grades and enhancing retail segments. The Company is also focussed on digitalisation to ensure fair price recovery and conducting auctioned sales for prime grades of all products.



Global iron ore prices witnessed significant volatility in CY 2022. The prices reached a peak of US$160/t in March 2022, driven by concerns over loss of significant supply in the context of geopolitical conflict in Europe. The prices gradually dropped through the year to touch a low of US$79/t in October 2022, owing to weakness in Chinese real estate sector. However, the iron ore prices firmed up in the following months and stabilised around

~US$120-130/t level in March 2023.

In India, FY 2023 iron ore production was stable at ~250 million tonnes with 6% increase in domestic steel production. However, iron ore exports fell by ~23% to ~20 million tonnes as Government of India (GoI) increased iron ore export duty in May 2022. Iron ore prices moved in tandem with global price movement during early CY 2022, however, the pricing later was decoupled due to sudden increase in export duty. In November 2022, GoI reversed the additional export duty. Iron ore prices increased in March 2023 driven by a seasonally strong steel sector demand and export opportunities.

Market Drivers

Indian iron ore production is expected to increase to 260 million tonnes by FY 2025. Iron ore exports from India are expected to increase with the removal of iron ore export duties and Karnataka iron ore export ban. The positive shift was evident in growing exports during last quarter of FY 2023 and is likely to sustain.

Global iron ore prices are expected to sustain in near term, driven by recovery in Chinas economy and specifically its construction sector post lifting of Covid restrictions. Additionally, a decrease in production from key producers, Australia and Brazil, is expected to further strengthen the prices.

Products and customers

The Company produces iron ore and pig iron, and caters to steelmaking, construction, and infrastructure sectors. It sells more than 65% of pig iron and 69% of iron ore in the domestic market.

In FY 2023, the Company strengthened its industry position by ramping up mining operations. It bagged iron ore blocks FEE grade and BICO in Odishas

Sundargarh in FY 2022 and operationalised both the mines in FY 2023 with a combined capacity of 5.5 MTPA. It also started mining operations in Bomi mine Liberia, achieving a production run-rate of 0.2 MTPA as on 31 March 2023.

The Company expanded its geographic reach in India and won Bicholim mine in Goa, with resources of 84.92 MTPA.



High carbon ferro chrome (HCFC) is a key raw material in stainless steel, adding special characteristics of non-corrosiveness, high durability and temperature resistance. Over 80% of all ferrochrome goes into manufacture of stainless steel, making it a key demand driver. South

Africa is the largest HCFC supplier and has significant bearing on market dynamics. However, Asia led by China is the largest consuming markets with 85% and 60% of the global HCFC consumption, respectively. Chinas large overall import/merchant demand continues to make it the most influential market for global supply-demand dynamics and prices.

In CY 2022, global HCFC production stood at ~15 million tonnes and India produced ~1.3 million tonnes, making it the fourth largest producer. India remained an export-oriented HCFC producer with 60% of the volume being exported.

HCFC prices in FY 2023, especially during first half of the year, experienced volatility. In April 2022, the prices were at a 12-month high of US$1,592/t. However, it fell to a 15-month low of US$1,173/t in September 2022. During second half of the year, the prices improved with China reopening; prices stood at around US$1,350/t level at the year end.

Market Drivers

Stainless steel demand and prices are the key market drivers for HCFC. With growing demand from infrastructure projects in developing countries and demand resumption from the largest market of China, stainless steel production is expected to grow at 4-5% for next fiscal. This is expected to drive demand global HCFC. The global HCFC production is likely to grow at 3-4%.

India is poised to be the fastest growing market, with both stainless steel and HCFC production projected to grow at 7-8%. Indias growth will be supported by largest-ever capital allocation for infrastructure creation including highway and airport development, railway network modernisation, and increased focus on housing construction.

Products and customers

Though India is an export-oriented country, Ferro Alloys Corporation (FACOR) is the second largest supplier of HCFC in the domestic merchant market. In FY 2023, FACOR sold 85% of its total ferro chrome volume within India, primarily to stainless steel and alloy steel producers.

The Company is focussed on developing value added products (VAP) portfolio. It increased its VAP capacity from 75 KTPA to 150 KTPA in FY 2023 to address niche markets in North America, Europe and South Korea. In FY 2024, the Company will be focussed on enhancing its volume and footprint both in Indian and global markets.



Copper experienced another volatile year in CY 2022. Copper prices soared to a record high above US$10,000/t in March 2022 owing to rising geopolitical tensions, inflation and energy costs. However, a downtrend owing to the fears of recession drove down prices to nearly two-year lows of less than US$7,000/t by July 2022. Since then, the prices have gradually been moving up and were average US$8,836/t during March 2023.

Overall global copper demand and supply were mostly flattish. Global refined copper consumption is estimated to have increased by 1.2% to 24.5 million tonnes. However, Indian copper market was strong in CY 2022; refined copper production and consumption increased by 10.5% to 550 kt and by 19% to 640 kt, respectively.

Market Drivers

In CY 2023, a rapid recovery in global economic activity and rebound in Chinas construction and automotive industry following its economic reopening are expected to improve copper demand. Globally,

CY 2023, is estimated to be a supply deficit year for copper with an estimated 2.6% growth in refined copper consumption, which would provide support to prices. Chinas refined copper consumption is expected to grow by 2.5% to 13.9 million tonnes and

Indias refined copper consumption to grow faster by

12.5% to 720 kt in CY 2023.

Indias total copper demand is projected to reach 2.8 million tonnes by 2030 driven by building and construction, manufacturing, transportation, and consumer durable industries. EV segment would play a crucial role in driving demand given their higher copper content compared to traditional vehicles.

Products and customers

The Company has one of the largest copper production capacities in India. It produces a wide range of copper products including 8 mm copper rod, 11.42 mm/12.45 mm/12.45 mm wax free, copper cathode and copper car bar with housing wires, winding wires and cables, transformer and electrical profile producers being its primary customers.

The Company sold 96% of its FY 2023 volume in domestic market. It also has presence in export markets, namely Saudi Arabia, Qatar and Nepal. The Company is undertaking various projects towards manufacturing green copper to strengthen its competitive positioning.

Executive summary:

We had a strong operational and financial performance in FY 2023 amidst the challenges faced due to macroeconomic uncertainty. The Company continues to focus on controllable factors such as resetting cost base through diverse cost optimisation initiatives, disciplined capital investments, working capital initiatives, marketing initiatives & volume with strong control measures to ensure safe operations across businesses within framed government and corporate guidelines.

In FY 2023, we recorded an EBITDA of 35,241 crore, 22% lower YoY with strong double digit adjusted EBITDA margin1 of 28%. (FY 2022: 45,319 crore, margin 39%). This was mainly due to slip in commodity prices at Aluminium, Lead and Silver and headwind in input commodity prices, partially offset by rupee depreciation, improved sales volume at zinc, aluminium and copper coupled with strategic hedging gains.

Higher sales volumes resulted in increase in EBITDA by 641 crore, driven by higher volumes at zinc, aluminium and copper partially offset by reduced sales volume at Oil & Gas and Iron & Steel.

Market factors resulted in decrease in EBITDA by

9,512 crore. This was primarily driven by input commodity inflation, decrease in the commodity prices, partly offset by rupee depreciation

Gross debt as on 31 March 2023 was 66,182 crore, increase of 13,073 crore since 31 March 2022. This was mainly due to the increase of debt at VEDL Standalone and temporary debt at HZL partially offset by reduction of debt at TSPL & ESL and receipt of inter-company loan from VRL.

Net debt as on 31 March 2023 was 45,260 crore, increased by 24,281 crore since 31 March 2022 (FY 2022: 20,979 crore), mainly due to dividend payment and capex outflow partially offset by cash flow from operations and working capital release.

The balance sheet of Vedanta Limited continues to remain strong with cash & cash equivalents, of 20,922 crore and Net Debt to EBITDA ratio at 1.3x well within the approved capital allocation framework (FY 2022: 0.5x)

1 Excludes custom smelting at copper business.

Consolidated EBITDA

EBITDA decreased by 22% in FY 2023 to 35,241 crore.

( crore, unless stated)

Consolidated EBITDA

FY 2023 FY 2022 % change
Zinc 19,408 17,695 10%
- India 17,474 16,161 8%
- International 1,934 1,533 26%
Oil & Gas 7,782 5,992 30%
Aluminium 5,837 17,337 (66%)
Power 851 1,082 (21%)
Iron Ore 988 2,280 (57%)
Steel 316 701 (55%)
Copper (4) (115) -
FACOR 149 325 (54%)
Others (86) 23 -


35,241 45,319 (22%)

Consolidated EBITDA bridge:

( Rs crore, unless stated)

Consolidated EBITDA % change

EBITDA for FY 2022


Market and regulatory: (9,512)

a) Prices, premium/discount (4,573)
b) Direct raw material inflation (9,984)
c) Foreign exchange movement 5,296
d) Regulatory changes (251)

Operational: (1,977)

e) Volume 641
f) Cost and marketing (2,618)



EBITDA for FY 2023


a) Prices, premium/discount

Commodity price fluctuations have a significant impact on the Groups business. During FY 2023, we saw a net negative impact of 4,573 crore on EBITDA due to slip in commodity prices.

Zinc, lead and silver: Average zinc LME prices during FY 2023 increased to US$3,319 per tonne, up 2% YoY; lead LME prices decreased to US$2,101 per tonne, down 8% YoY; and silver prices decreased to US$21.4 per ounce, down 13% YoY. The cumulative impact of these price fluctuations decreased EBITDA by 387 crore.

TC/RC in Zinc International Business during FY 2023 increased to US$245/dmt up 148% YoY, decreased EBITDA by 645 crore.

Aluminium: Average aluminium LME prices decreased to US$2,481 per tonne in FY 2023, down 11% YoY, this had a negative impact of 5,732 crore on EBITDA.

Oil & Gas: The average Brent price for the year was US$96 per barrel, up 18% YoY. This had positive impact on EBITDA by 1,183 crore.

Iron & Steel: Higher realisations positively impacted EBITDA at ESL by 771 crore.

b) Direct raw material inflation

Prices of key raw materials such as imported alumina, thermal coal, carbon and coking coal have increased in FY 2023, negatively impacting EBITDA by 9,984 crore, primarily at Aluminium, Zinc and Iron & Steel business.

c) Foreign exchange fluctuation

Rupee depreciated against the US dollar during FY 2023. Stronger dollar is favourable to the Groups EBITDA, given the local cost base and predominantly US dollar-linked pricing. The favourable currency movements positively impacted EBITDA by 5,296 crore.

Key exchange rates against the US dollar:

Average year ended 31 March 2023 Average year ended 31 March 2022 % change As at 31 March 2023 As at 31 March 2022

Indian rupee

80.27 74.46 7.8% 82.16 75.59

d) Regulatory

During FY 2023, changes in regulatory levies such as Renewable Power Obligation etc. had a cumulative negative impact on the Group EBITDA of 251 crore.

e) Volumes

Higher volume led to increase in EBITDA by 641 crore by following businesses: HZL (positive 1,153 crore): In FY 2023, HZL achieved metal sales of 1,032 kt, up 7% YoY and silver sales of 714 tonnes up 10% YoY

ZI (positive 385 crore): In FY 2023, ZI achieved MIC sales of 273 kt, up 22% YoY

Aluminium (positive 141 crore) Partly offset by:

Cairn (negative 761 crore) and Iron and Steel (negative 333 crore) f) Cost and marketing (-2,618 crore)

Higher costs resulted in decrease in EBITDA by 3,167 crore over FY 2023, primarily due to increased cost, partially offset by higher premia realisations at Aluminium business.

g) Others

This primarily includes the impact of strategic hedging gains, partially offset by inventory adjustments during the year.

Income statement

( Rs crore, unless stated)


FY 2023 FY 2022 % Change
Net Sales/Income from 1,45,404 1,31,192 11%
Other Operating Income 1,904 1,541 24%
EBITDA 35,241 45,319 (22%)
EBITDA margin1 (%) 28% 39% -
Finance Cost 6,225 4,797 30%
Investment Income 2,851 2,341 22%
Exchange Gain/(Loss) (492) (235) -
Exploration Cost Written off (327) - -
Profit before Depreciation and 31,048 42,627 (27%)
Depreciation and Amortisation 10,555 8,895 19%
Profit before Exceptional items 20,493 33,732 (39%)

Exceptional items2 : credit/(expense)

(217) (768) -
Taxes3 5,770 9,255 (38%)
Profit after taxes 14,506 23,710 (39%)

Profit after taxes (before Exceptional Items)

14,449 24,299 (41%)
Minority interest 3,929 4,908 (20%)
Attributable PAT 10,574 18,802 (44%)
(after exceptional items)
Attributable PAT 10,521 19,279 (45%)
(before exceptional items)
Basic earnings per share 28.50 50.73 (44%)
Basic EPS before exceptional 28.36 52.02 (45%)
items (/share)
Exchange Rate (/US$) – 80.27 74.46 8%
Exchange Rate (/US$) – 82.16 75.59 9%

1. Excludes custom smelting at Copper business

2. Exceptional Items gross of tax

3. Tax includes tax benefit on exceptional items of 274 crore in FY 2023 (FY 2022: tax benefit of178 crore)

4. Previous period figures have been regrouped/rearranged wherever necessary to conform to current period presentation


Reported record revenue for the year was 1,45,404 crore, higher 11% YoY. This was primarily driven by higher volumes at copper, zinc and aluminium, strategic hedging gains and rupee depreciation, partially offset by slip in commodity prices majorly of aluminium, copper, lead, and silver.


Second highest EBITDA for the year was 35,241 crore, 22% lower YoY. This was mainly due to slip in commodity prices at Aluminium, Lead and Silver and headwind in input commodity prices, partially offset by rupee depreciation, improved sales volume at zinc, aluminium, and copper coupled with strategic hedging gains.

We maintained a strong double digit adjusted EBITDA margin of 28% for the year (FY 2022: 39%)

Depreciation and Amortisations

Depreciation for the year was 10,555 crore compared to 8,895 crore in FY 2022, higher by 19%, due to increase in ore production at Zinc India and higher depletion charge at Oil & Gas business.

Net Interest

The blended cost of borrowings was 7.8% for FY 2023 compared to 7.9% in FY 2022.

Finance cost for FY 2023 was 6,225 crore, 30% higher compared to 4,797 crore in FY 2022 mainly on account of increase in average borrowings.

Investment income for FY 2023 stood at 2,852 crore, 22% higher compared to 2,341 crore in FY 2022. This was mainly due to interest received on income tax refund, mark-to market movement and change in investment mix.

Exceptional Items

The exceptional items for FY 2023 were at (217) crore, mainly on account of SAED partly offset by impairment reversal in ESL & WCL.

[for more information, refer note [36] set out in P&L notes of the financial statement on exceptional items].


Tax expense for FY 2023 stood at 5,770 crore (FY 2022: 9,255 crore). The normalised ETR is 30% as compared to 28% in FY 2022 due to change in profit mix.

Attributable profit after tax (before exceptional items)

Attributable PAT before exceptional items was 10,521 crore in FY 2023 compared to 19,279 in FY 2022.

Earnings per share

Earnings per share before exceptional items for FY 2023 were 28.36 per share as compared to 52.02 per share in FY 2022.


Board has declared total dividend of 101.5 per share during the year.

Shareholders Fund

Total shareholders fund as on 31 March 2023 aggregated to 39,423 crore as compared to 65,383 crore as of 31 March

2022. This was primarily net profit attributable to equity holders earned during the year partially offset by dividend paid during the year.

Net Fixed Assets

The net fixed assets as on 31 March 2023 were

1,15,273 crore. This comprises 17,434 crore as capital work-in-progress.

Balance Sheet

Our financial position remains strong with cash and liquid investments of 20,922 crore.

The Company follows a Board-approved investment policy and invests in high quality debt instruments with mutual funds, bonds and fixed deposits with banks. The portfolio is rated by CRISIL which has assigned a rating of "Tier I" (meaning highest safety) to our portfolio.Gross debt as on 31 March 2023 was 66,182 crore, an increase of Rs13,073 crore since 31 March 2022. This was mainly due to the increase of debt at VEDL standalone and temporary debt at HZL partially offset by reduction of debt at TSPL & ESL and receipt of inter-company loan from VRL.

Gross Debt comprises term debt of Rs.54,543 crore, working capital loan of c.2,733 crore and short-term borrowing of c. 8,906 crore. The loan inRscurrency is 90% and balance 10% in foreign currency. Average debt maturity of term debt is ~c. 3.4 years as of 31 March 2023.

CRISIL and India Ratings at AA with negative outlook.