Vedanta Q3 results: Profit surges as aluminium strength lifts EBITDA

After the market hours on Thursday, January 29, the Indian mining conglomerate owned by Anil Agarwal, Vedanta Limited, has shared the results of the December quarter, which are deemed to be higher in various parameters year-on-year.

Net profit and other incomes  

In the last December quarter, the firm achieved a net profit worth INR 571.0 billion (USD 6.21 billion), which in the previous year reached INR 354.7 billion (USD 3.86 billion), reflecting a year-on-year increase of 60.1 per cent.

In the same quarter, the other incomes also increased from INR 49.2 billion (USD 535 million) in the previous year to INR 33.9 billion (USD 368 million), showing a positive movement by 31.1 per cent. At the same time, the firm's revenue went up by 19 per cent, from the previous INR 4,589.9 billion (USD 49.94 billion) in the last year to INR 3,852.6 billion (USD 41.93 billion).

Also read: Vedanta Aluminium: Is rising bauxite risking the next earnings fault line?

EBITDA performance

Year-on-year, the quarter’s Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) jumped by 37 per cent while the margins became steady at 29.4 per cent, from INR 501.3 billion (USD 5.45 billion) to INR 686.6 billion (USD 7.47 billion).

The maximum of Sum of The Parts (SOTP) valuation holds the lion's share of the company's EBITDA, whose value is recorded to be much above the average poll, from INR 682.1 billion to INR 702.3 billion, representing an increase of 3 per cent.

The rise in EBITDA is mainly owed to the higher prices, but the offset is also contributed to by the hedged quantities. Vedanta's per tonne EBITDA is deemed to be the highest and is at USD 1,238.

The aluminium segment of the firm posted the most substantial EBITDA margin of USD 1,268 per tonne, which is also supported by record alumina and aluminium production. The aluminium prices were lifted as Chinese producers face rising costs from winter power cuts and stricter environmental rules throughout the supply chain, as noted by analysts at Elara Capital.

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The brokerage pointed out that low inventory levels and production hiccups in China, which is deemed to be a key production hub, are expected to keep aluminium prices stable in the near future. In addition, on the London Metal Exchange (LME), prices for three-month aluminium, zinc and copper saw year-on-year increases of 11.8 per cent, 5.3 per cent and 21 per cent, respectively, during the quarter in question here.

By the end of the said quarter, the firm's net debt to EBITDA remained at 1.23 times, which means the total debt remains at INR 6,062.4 billion.

Stakes & ownership

Hindustan Zinc, a subsidiary of Vedanta Limited, where the parent company holds ownership of 60.7 per cent, which, however, has been reduced after the recently concluded Offer For Sale, where about 45 per cent of the EBIT comes from this subsidiary.

On January 29, Vedanta's share price closed at INR 767.55 apiece, showing a high of 4.1 per cent. In the last 12 months, the overall stocks have been up by 78 per cent.

Future projection

The recent approval for the demerger into five distinct entities is a significant milestone. These results highlight strong operational momentum and show that Vedanta is well-prepared to unlock long-term value as it moves forward on its 2.0 journey.

To know more about the global primary aluminium industry 2026 outlook, book the report “Global ALuminium Industry Outlook 2026".