Vedanta, an associate company of the LSE listed Vedanta Resources Plc, is expected to show strong growth in profitability on low base in year-ago period. Profit is expected to be at Rs 2,500 crore during the quarter against Rs 18 crore in same quarter last year, according to average of estimates of analysts polled by CNBC-TV18.
Management's commentary is important to watch out for than results. Majority of earnings' contribution come from Hindustan Zinc and Cairn India, wherein Vedanta owns 65 percent and 59 percent stake, respectively. Both companies' results beat analysts' expectations.
Revenue is seen rising 30 percent year-on-year to Rs 19,400 crore from Rs 14,876 crore. Operating profit during the quarter may jump 88 percent to Rs 5,850 crore and margin may expand 930 basis points to 30.2 percent on yearly basis. Results will look phenomenal on a low base. In Q3FY16 on EBIT basis, oil & gas, iron ore and aluminum segments delivered a loss. Hence, these segments are expected to deliver a positive EBIT in Q3FY17.
Vedanta may benefit from volume ramp-up and commodity price increases. Results may look great led by strong volume-and-price-led growth in zinc and aluminum.
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