Buy Vedanta; target of Rs 316: Motilal Oswal

Motilal Oswal's research report on Vedanta
Cons. EBITDA increased 42% YoY to INR48.7b (est. of INR50.7b), driven by strong growth in zinc, O&G and aluminum (AL) . The iron ore, copper (Cu) and power segments, however, reported weak operating performance. Adjusting for  recovery of past costs (not quantified) in O&G revenue, the  EBITDA miss  stands at  7-10% due to  poor Cu by -product credits ,  slower growth in commercial production of AL , lower sales quantity of  iron ore and pig iron and less volumes at Skoprion Zinc due to shut down.

Outlook

Vedanta (VEDL) has a portfolio of high -quality base metals and O&G asset, and is well poised to benefit from the  bullish price outlook for zinc. We maintain Buy with a target price of INR316 .

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