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Vedanta, a diversified metal and energy company, has reported 67 per cent increase in June quarter consolidated net profit at ₹2,270 crore (₹1,358 crore) on the back of higher contribution from the recently merged subsidiary Cairn India and metal business in India.
Revenue from operations was up 26 per cent at ₹19,342 crore (₹15,310 crore). Income from oil and gas business increased 21 per cent at ₹2,275 crore (₹1,885 crore), while that of metals was up 90 per cent to ₹4,478 crore (₹2,354 crore).
Ebitda during the quarter was up 40 per cent at ₹4,965 crore (₹3,539 crore).
However, net profit during the quarter is down 48 per cent compared with ₹4,226 crore recorded in the March quarter.
Similarly, net sales were down 19 per cent compared to March quarter sales of ₹22,371 crore. The company attributed the fall in profit and sales on sequential basis due to higher contribution by Hindustan Zinc in the March quarter.
In the last five months, the company has repaid debt of ₹9,000 crore to deleverage balance sheet and reduce interest outgo.
Tom Albanese, Chief Executive Officer, said oil and gas has delivered strong set of numbers, while zinc was supported by higher production and rising prices on the back of global supply deficit.
“This is the first quarterly results after Cairn India was merged with Vedanta and we are already realising the benefits of the diversified portfolio,” he said.
Arun Kumar, Chief Financial Officer, said with the strong balance sheet the company is in a comfortable position to execute the planned capex of $1.2 billion this fiscal.
Despite net debt to Ebitda of 0.8, he said the company will continue to deleverage the balance sheet depending on growth opportunity.
Albanese said the Cabinet has recently cleared a policy to renew oil and gas production sharing contracts signed before the system of auction was introduced in 1999.
The 25-year lease period for Cairn India’s Barmer oil block in Rajasthan expires in May 2020.
The government has agreed to renew the contracts provided the companies increase the government’s share of profit.
With the reduction in debt, he said Vedanta is future-ready and will continue to focus on increasing production, optimising cost and remain disciplined on capex.
The company’s scrip was up four per cent at ₹274 on Tuesday.
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