The Vedanta Aluminium business has scaled back its future earnings projections, with the EBITDA for the current fiscal year revised from earlier estimates of more than double past USD 4 billion to USD 2.7 billion. Despite a supportive global market scenario, Vedanta now forecasts its aluminium EBITDA of USD 3.6 billion for FY27 and USD 4.1 billion for FY28. 

Explore- Most accurate data to drive business decisions with Global ALuminium Industry Outlook 2026 across the value chain

Aluminium prices remained firm at around USD 3,100 per tonne in February 2026, with Vedanta peers reporting robust performance. Hindalco Industries posted the upstream aluminium EBITDA of USD 1,572 per tonne with 45 per cent margins in Q3 of FY26. Similarly, Alcoa recorded full-year 2025 net income of USD 1.2 billion.

This financial contrast indicates company-specific operational pressures on Vedanta rather than broad market weakness.

Industry landscape and market reactions

Industry sentiment for 2026. While several forecasts point to tight supply and electrification-led demand supporting prices near or above USD 3,000 per tonne, Goldman Sachs has projected a potential surplus that could weigh on prices.

Vedanta has targeted production costs of USD 1,500 per tonne of aluminium to boost competitiveness. However, the revised EBITDA outlook indicates that such efficiency gains will need time before adequately counterbalancing any operational challenges that may be hindering progress.

Although in its Q3 results on January 30, Vedanta reported a record consolidated quarterly EBITDA of INR 151 billion (USD 1.66 billion) in its Q3 results, its stocks depicted an estimated 8 per cent decline. 

The market showed a concerned reaction, not to the overall group earnings strength but to the divisional performance. In February 2026, Vedanta’s P/E ratio settled around 14.9, suggesting that valuations may be scrutinised if segment-level performance does not improve. 

Also read: Vedanta Aluminium deploys CFD-driven cooling network to save energy at Jharsuguda smelter

Strategies deemed doubtful?

The revised outlook on the aluminium segment of Vedanta has stemmed concerns. Compared with cost-competitive peers, it may be facing higher operational pressures or slower margin expansion.

Analyst Motilal Oswal has recognised the company’s operational resilience and balance sheet improvements, but continues to remain at a ‘Neutral’ stance on Vedanta, citing valuation considerations.

Additionally, Vedanta’s ongoing demerger process, creating standalone entities to unlock shareholder value, poses transitional risks. Strategic significance aside, restructuring plans may bring about short-term execution challenges and compromise management objectives.

An outlook depending on cost control and structural delivery

Moving forward, investor focus will likely stay on Vedanta’s ability to deliver its revised FY27 and FY28 aluminium EBITDA targets. The company’s performance depends on efficient cost management, ramp-up of value-added products, optimised operations and finally, disciplined capital allocation.

Although broader aluminium market conditions look strong, segment-level execution remains critical. The eventual performance of the demerged aluminium entity is likely to play a decisive role in determining whether shareholder value is ultimately unlocked. 

Image source: https://vedantaaluminium.com/

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