Mining and metals company Vedanta Ltd is planning to spend Rs 2 billion on capital expenditure (capex) across businesses in FY24, doubling it from the FY23 capex, senior management said over a conference call on April 28.
The company reported a five percent year-on-year decline in consolidated profit after tax (PAT) at Rs 7,261 crore for the fourth quarter of 2022-23 as it had a significantly higher base in the previous year due to exceptional items. The company said that the PAT, before the exceptional item and one-time tax credit, was Rs 7,570 crore, up 48 percent on-year. The consolidated quarterly revenue for the March quarter was Rs 39,342 crore, up 41 percent on-year.
The earnings before interest, taxes, depreciation, and amortisation (EBITDA) for FY23 was over $6 billion, of which around $2 billion came from the fourth quarter. The management said that if the commodity prices remain at the current escalated levels and with the company’s cost-effective measure towards integration, it could clock EBITDA of $8 billion in fiscal 2023-24.
“We are a business which could go to $30 billion of revenues and maybe $12 billion-$13 billion of EBITDA. We will have $2 billion for capex and the other needs of the business,” said Sunil Duggal, Group Chief Executive Officer.
Duggal said that with these projections he sees potential free cash at $8 billion, which would be used for deleveraging the balance sheet.
In a recent interview with Moneycontrol, Chairman Anil Agarwal said that the company has the potential to have revenue of $50 billion.
The company said that dividends from the profit will also help the parent company, Vedanta Resources, pare its debt. Vedanta Resources plans to reduce debt by $4 billion in the next three years.Vedanta, the Indian listed arm, reduced its net debt by Rs 6,590 crore from December-end to net debt of Rs 20,979 crore in March-end.