Vedanta's Q2 results show a Rs 1,783-crore deficit compared to a profit a year earlier

6 Nov 2023 , 01:58 PM

The mining giant Vedanta had a combined net loss of Rs 1,783 crore for the quarter that ended in September 2023, down from Rs 1,808 crore and Rs 2,640 crore in the same period the previous year.

The whole income from activities increased 6.3% YoY to Rs 38,945 crore. The topline increased dramatically by almost 15.4% sequentially.

The main cause of the loss throughout the quarter was a substantial increase in the net tax outgo. Due to the implementation of the new tax system and the tax deduction on a one-time gain of Rs 1,223 crore, the net tax outflow rose to Rs 9,092 crore from Rs 1,674 crore the previous year.

Vedanta had strong performance at the operating level, with profit—defined as profits before interest, taxes, depreciation, and amortization—growing by 49% year over year to Rs 11,479 crore. The operating margin then increased by 847 basis points to 29.47%.

The zinc industry as a whole saw a 25% decline in international business revenue and a nearly 19% decline in domestic revenue during the quarter.

Due to low demand and falling prices, the aluminium industry also saw a downturn, with revenue falling by more than 11% YoY to Rs 11,952 crore.

The iron ore business recorded a 38% increase in sales to Rs 2,083 crore, while the copper business reported a roughly 15% spike in revenue to Rs 4,606 crore.

Revenue from the oil and gas industry increased to Rs 8,229 crore from Rs 3,869 crore the previous year.

Due to the decline in revenue, the EBITDA of the foreign business fell by 51% to Rs 289 crore, and the EBITDA of the India zinc business fell by more than 29% YoY to Rs 3,073 crore.

Compared to a profit of Rs 15 crore a year earlier, the copper company reported an EBITDA loss of Rs 62 crore for the quarter.

Iron ore’s EBITDA climbed by 50% to Rs 320 crore, while the aluminium industry’s nearly threefold year-over-year gain was recorded at Rs 1,967 crore.

Strong free cash flow of Rs 5,694 crore, up 84% sequentially, was produced by the company during the quarter.

At the end of September, the net debt was Rs 57,771 crore, down Rs 1,420 crore on a sequential basis. Net debt to EBITDA decreased from 1.88 to 1.64 as of the most recent quarter.

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