Billionaire Anil Agarwal-led metals and mining conglomerate Vedanta Ltd reported a 40 percent drop in consolidated net profit for the April-June quarter of FY24 on July 21 at Rs 2,640 crore against Rs 4,421 crore in the same quarter last year. However, the drop in profit is less than what analysts were expecting, which was in the range of Rs to 1,410 crore.
The decline is primarily due to the impact of weaker commodity prices across various segments, particularly in zinc and aluminium.
The company also reported one-time gain of Rs 1,780 crore in this quarter compared with nil in the year-ago period.
Further, the consolidated revenue for the metals-to-oil conglomerate also fell 13 percent to Rs 33,342 crore from Rs 38,251 crore in the year-ago quarter, which was more than what Street estimated.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) declined 39percent YoY to Rs 6,029 crore as against Rs 9,826 crore in Q1FY23, which was less than the Street estimates of Rs 7,040 crore. EBITDA margins contracted 760 basis points to 18.1 percent from 25.7 percent.
One basis point is one-hundredth of a percentage point.
Vedanta, in its regulatory filing, also mentioned that the company's chief executive officer Sunil Duggal will retire as whole-time director & CEO of with effect from July 31, 2023.
Commenting on the quarterly performance, Duggal said, "We remain committed to maximizing shareholder returns through best-in-class and low-cost operations, skill development and global experience leadership with sustainability at the forefront.”
Coming to segmental performance, revenue from zinc, lead and silver fell 23 percent to Rs 7,062 crore. Aluminium revenue was down 19 percent at Rs 11,905 crore. Meanwhile, copper and iron ore segments also saw a decline.
For FY24, the company has estimated a capex of $1.7 billion, higher than $1.2 billion in FY23.
Meanwhile, shares of Vedanta on July 21 closed 1.36 percent lower at Rs 278.30 apiece on BSE ahead of the earnings.
The results are on better-than-expected as analysts predicted a fall in earnings in the June quarter primarily due to the impact of weaker commodity prices across various segments, particularly in zinc and aluminium.
On July 18, Vedanta semiconductor head Akarsh K Hebbar said the company "remains fully committed to building India’s first semiconductor and display fabs in Dholera Special Investment Region in Ahmedabad district, Gujarat."
Hebbar's comment came after Vedanta and electronics manufacturing giant Foxconn on July 10 called off their joint venture, which planned to invest $19.5 billion to set up a semiconductor manufacturing unit in Gujarat.
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