The Indian commodities magnate Anil Agarwal chaired Vedanta Ltd. publicized a consolidated net profit of INR 4,615 crore in the July-September quarter, which reveals an upswing by more than five times from the corresponding period previous year at INR 838 crore on a low-base effect. Consecutively, net profit was up 9.2% from INR 4,224 crore.
The top line of the company during the phase under review, stood at INR 30,048 crore, surging by 44% from the same period existing year on the shoulder of towering commodity prices. However, the quarterly revenue is considered a record for the company.
On a call to discuss the earnings, Sunil Duggal, CEO of Vedanta commented: “High commodity prices have placed Vedanta in a strong position and we are benefitting from this increase in prices.”
He also added: “Within business segments, aluminium revenues were the highest at INR 12,119 crore in the quarter despite coal shortage, mainly in the month of September. This was followed by zinc-lead revenues of INR 5,897 crore in the period under review.”
As per the estimates, the company’s net sales in the July-September quarter were anticipated to be at INR 28,396 crore, whereas the bottom line was spotted at INR 4,503 crore.
Besides, the company also booked a record quarterly EBITDA of INR10,582 crore in the September quarter, rising by 62% Y-o-Y on enhanced commodity prices and higher aluminium volumes.
The Ebitda margin during the period under review was at 40% as against 41% in the previous quarter and 36% in the corresponding period last year. While with the count to debt levels, Vedanta’s gross debt was at INR 51,040 crore on 30th September 2021, down by INR 11,719 crore on a Y-o-Y basis. However, this was primarily due to deleveraging in the zinc and aluminium business. The net debt remained at INR 20,389 crore in the period under review, a dip by INR 7,232 crore on a Y-o-Y basis, majorly propelled by strong cash flow from operations, post-Capex and dividend pay-out.
Duggal said: “We witnessed steady volume performance across business segments, and sustained margins benefitting from high commodity prices despite a challenging cost environment. We continue to focus on prudent capital allocation and deleveraging. We reduced net debt by INR 7,232 crore year-on-year.”
“We have strong cash and cash equivalents of INR 30,650 crore. The company follows a board-approved investment policy and invests in high-quality debt instruments with mutual funds, bonds, and fixed deposits with banks.”
In regards to the coal crisis, Duggal said: “The situation is improving with average coal stockpiles days moving to 5 days from one day during September. Within the next 3-4 weeks, the coal supply situation should ease.”
source https://www.alcircle.com/news/improved-commodity-prices-higher-aluminium-volumes-braced-vedantas-q2-profit-to-upswing-fivefold-71758
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