Motilal Oswal's research report on Vedanta
VEDL reported consolidated net sales of INR355b, down 6% YoY, in line with our estimates. VEDL’s consolidated EBITDA came in at INR87.7b (down 7 % YoY), in line with our estimate of INR85b. EBITDA was supported by higher volume and structural cost-saving initiatives across businesses, partially offset by muted revenue during the quarter. In 4QFY24, the EBITDA margin was lower by ~25bp YoY to 24.5% as compared to 24% in 3QFY24. APAT for the quarter stood at INR16b (down- 50% YoY) and was 16% lower than our estimate of INR19b. Lower ‘other income’ and higher tax outgo adversely impacted APAT. VEDL’s net debt stood at ~INR563b (down from INR625b in 3QFY24) and net debt/EBITDA stood at 1.5x in 4QFY24.
Outlook
We marginally increase our EBITDA estimates by 4% in FY26 to incorporate the improving outlook. We reiterate our Neutral rating on VEDL with a revised SoTP-based TP of INR360
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