About Vedanta
Vedanta Ltd. is a multinational Indian metals and mining company headquartered in Mumbai, India. The company runs mines in India for aluminium, copper, iron ore, zinc, and lead, and it also owns smelters and refineries. In addition to these operations, there are oil and gas deposits off the east coast of India. It was formerly known as Sesa Sterlite Limited (Sesa), but its name was changed to reflect its varied mining and minerals business portfolio. The company is listed on both the BSE and the NSE.
History of Vedanta
In the 1980s, D.P. Agarwal created Sterlite Industries (India) Limited in Mumbai and began purchasing mining concessions in various states of India. This was the beginning of Vedanta, which was then known as Sterlite Industries. Soon after, he was joined by his two sons, Navin Agarwal and Sunil Agarwal, who both today manage the business. In 1992, they created Volcan investments in Nassau (Bahamas) as their mines’ primary holding company. In Patna, D.P.Agarwal had a modest aluminium conductor business. Anil Agarwal, his son, had travelled to Mumbai to build the firm.
In the 1990s, when the Indian government began selling off ailing (underperforming) industries, Sterlite began bidding on them. They were able to successfully bid on BALCO and Hindustan Zinc Limited, both of which had been closed for four years due to bankruptcy. D. P. Agarwal created Twinstar Holdings Limited in Mauritius in January 1993, which was mostly owned by Volcan investments. On 26 May 2002, the Enforcement Directorate issued a show cause notice to Sterlite, relating to the six-year period between 1993 and 1999 when Twinstar acquired the shares of Sterlite and various investment companies, such as Dwarka Prasad Anil Kumar Investments Private Limited, Pravin Navin Investment & Trading Private Limited, and Sterlite Copper Rolling Mills Private Limited (RBI). On April 29, 1999, a number of these investment entities were liquidated, and Twinstar regained ownership of all Sterlite shares. Twinstar became the sole shareholder of these investment entities and obtained official permissions from the Reserve Bank of India and the Foreign Investment Promotion Board (FIPB).
On December 8, 1999, authorities from the Income Tax department searched the Sterlite offices in Dhanraj Mahal, Apollo Bunder, and Tulsiani Chambers in Mumbai and collected a large number of records. As it looked like there may have been a breach of the country’s foreign exchange laws, the IT department opted to retain the services of ED personnel. After reviewing these records, the ED deduced that Twinstar was established for the sole purpose of acquiring a stake in Sterlite. The Directorate said that before disposing of the shares of the investment businesses listed, the Agarwals had written off loans totalling Rs. 230 million and agreed to donate their offshore corporate body, Twinstar, a sum totalling Rs. 338 million, which included shares of Sterlite worth Rs. 72 million. Sterlite and its investment businesses allegedly imported Rs 2.08 billion to India through Twinstar between 1993 and 1999 in order to subscribe to Sterlite shares and make investments in the company.
Anil Agarwal’s Vedanta Resources Plc, a diversified metals and mining company, acquired Mitsui & Co. Ltd.’s controlling 51% interest in Sesa Goa Ltd. in 2007. Vedanta Resources is a London Stock Exchange-listed company and component of the FTSE 100 Index. The deal was worth Rs. 40,7 billion (US$510 million), making it the industry’s highest M&A transaction to date. In 2009, Sesa Goa purchased the mining and maritime divisions of Goa-based Dempo Group for Rs 17.5 billion (US$220 million). This was the second largest acquisition in India’s iron-ore business, and it gave Sesa Goa access to 70 million tonnes of iron-ore mineable deposits in Goa owned by Dempo. In 2011, Sesa Goa paid $90 million for a 51 percent share in Western Cluster, Liberia. The Liberian Gola Forest Community residents, who also suffered during the civil war, think that the arrival of the Western Cluster will alleviate their suffering and create work opportunities.
Mitsui & Co., Ltd. sold a 51% controlling stake to Vedanta Resources Plc, a company listed on the London Stock Exchange, in 2007. As a result, Mitsui became a majority-owned subsidiary of Vedanta Resources Plc in 2007. In June 2009, Sesa Goa Limited acquired VS Dempo & Co. Private Limited (now Sesa Resources Limited) as well as its wholly-owned subsidiary Dempo Mining Corporation (now Vedanta Limited) and a 50% stake in Goa Maritime Private Limited. Vedanta bought the zinc assets of the British mining company Anglo American plc in 2010.
In 2011, Vedanta Resources acquired a 58.5 percent controlling stake in Cairn India, the largest private oil and gas company in India.
Sterlite Industries and Sesa Goa announced their merger in 2015 and finally merged in August of the same year. In 2015, the name of Sesa Sterlite was changed to Vedanta Limited. Cairn India merged with Vedanta Limited on 11 April 2017 to strengthen its position as one of the world’s largest diversified natural resources corporations.
Top Shareholder
Below is a list of the top shareholders of Vedanta share as of August 2022.
| Shareholder | No. of Shares | Shares (%) |
| Twin Star Holdings LTD | 1,72,48,05,858 | 46.40 |
| Vedanta Holdings Mauritius II Limited | 49,28,20,420 | 13.26 |
| Finsider International Company Limited | 16,34,64,540 | 4.40 |
| Vedanta Holding Mauritius Limited | 10,73,42,705 | 2.89 |
| Vedanta Netherlands Investments B.V | 6,35,14,714 | 1.71 |
| Life Insurance Corporation Of India | 32,90,75,318 | 8.85 |
| Foreign Portfolio Investors | 32,27,34,952 | 8.68 |
| Mutual Funds | 7,81,79,907 | 2.10 |
Management Of Vedanta
Below is a list of top management of Vedanta as on August 2022
| Name | Designation |
| Anil Agarwal | Non-Executive Chairman – Non-Independent Director- Chairperson |
| Navin Agarwal | Executive Vice Chairman |
| Sunil Duggal | Executive Director – CEO |
| Ajay Goel | Chief Financial Officer |
| Prerna Halwasiya | Company Secretary & Compliance Officer |
| Priya Agarwal | Non-Executive Director |
| Madhu Srivastava | Chief Human Resource Officer |
| Sharad Gargiya | Chief Commercial Officer |
| Arun Misra | Chief Executive officer Hindustan Zinc Limited |
| Sauvick Mazumdar | Chief Executive Officer, Iron & Steel Business |
Key Highlights From Vedanta’s Latest Quarterly Results – Q1 FY 23
- On 28 June 2022, the multinational mining company Vedanta announced its financial results for the first quarter of the fiscal year 2023. The company reported a post-tax (PAT) of Rs. 4,421 crores in Q1 FY23, an increase of 4.66 per cent year-on-year (YoY) from Rs. 4,224 crores in Q1 FY22.
- Vedanta posted its highest-ever first-quarter EBITDA, which was Rs. 10,741 crores in Q1 FY23, an increase of 7% year-over-year. Additionally, Vedanta demonstrated an industry-leading EBITDA margin of 32%. The Net Debt/EBITDA ratio was kept at a manageable level of 0.6x.
- The company’s income from operations increased by 36.1% year-over-year from Rs. 28,105 crores in Q1 FY22 to Rs. 38,251 crores in Q1 FY23. This can be ascribed to the company’s major businesses’ ongoing solid operating performance.
- The company’s operational highlights include a 3% YoY increase in aluminium output, which reached 565 kt. As for the Zinc (India) division, Q1 FY23 marked the greatest ever first quarter refined metal production with 260 kt, a 10% YoY increase. This quarter also recorded the largest quarterly ore output ever, at 140 kt, up 14% year-over-year.
- However, Karnataka’s production of saleable iron ore and steel decreased by 14% and 7%, respectively, year-over-year. In addition, the average gross operated production of Oil and Gas decreased 10% year-over-year in the first quarter of fiscal year 23 due to a natural decline, which was mainly offset by infill wells and gas production.
- The company’s return on capital employed increased by 780 basis points year over year to reach 30%. In the first quarter of the fiscal year 23 for Vedanta, cash and cash equivalents totalled Rs. 34,342 crores.
- During the quarter, Rs. 31.5 per share was declared as the first interim dividend. In July, the second interim dividend of Rs. 19.5 per share was announced, resulting in a dividend yield of 15.4%. In the first quarter of fiscal year 23 (Q1), the company’s basic earnings per share (EPS) increased from Rs. 11.40 in Q1 FY22 to Rs. Prior to the announcement, Vedanta Share finished at Rs. 245.40 a share, up 0.82 percent over the previous day’s close.
- Vedanta finished the scope-3 emission inventory, climate risk assessment, and internal carbon pricing.
- A contract was made by Cairn to use its repurposed oil and gas wells to generate geothermal energy.
- India’s largest fleet of electric forklifts was used at Jharsuguda.
- At HZL’s Zawar mine, the nation’s first battery electric vehicle (BEV) in the UG Mine was unveiled.
- Vedanta received the designation of “excellent place to work.” Women make up 29% of the decision-making bodies at the company. Additionally, 9 transgender people worked there.
Key Data Points
- Profit after tax touched Rs. 4,421 crores in the first quarter of the fiscal year 2023 (FY23), a steady increase of 4.66 percent year-over-year.
- In the first quarter of the fiscal year 2023, EBITDA reached a record high of Rs. 10,741 crores, an increase of 7% year-over-year.
- Vedanta exhibited an industry-leading 32% EBITDA margin.
- In the first quarter of the fiscal year, 2023 revenues from operations increased by 36.1% year-over-year to Rs 38,251 crore.
- Return on capital employed increased by 780 basis points year-over-year to 30%.
- 3% year-over-year increase in aluminium production.
- At 260 kt, the Zinc (India) segment recorded the greatest ever first-quarter refined metal production, up 10% YoY.
- Record quarterly ore production of 140 kt, up 14% year-over-year.
- The initial interim dividend per share was declared to be Rs. 31.5. Second interim dividend of Rs. 19.5 per share was declared.
- EPS amounted to Rs. 11.92.
- Karnataka’s production of saleable ore decreased by 14% year-over-year.
- The year-over-year decline in saleable steel production was 7%.
Revenue
- Zinc, Lead, and Silver (India): Q1 FY23 revenue climbed 45.11 percent year-over-year to Rs. 9,175 crores from Rs.
- Zinc (International) first-quarter revenue climbed by 30.38 percent year-over-year to Rs.1,459 crore from Rs.1,119 crore in Q1 FY22.
- Oil & Gas: Revenue climbed 64.31 percent year-over-year from Rs. 2,485 crores in Q1 FY22 to Rs.
- Aluminum: Q1 FY23 revenue climbed 42.69 percent year-over-year to Rs. 14,644 billion from Rs.
- Copper: Revenue climbed 20.46 percent year-over-year from Rs. 3,499 crores in Q1 FY22 to Rs.
- Iron Ore: Q1 FY23 revenue declined 13.26% year-over-year to Rs. 1,367 billion from Rs.
- Power: Revenue climbed 44.49% year-over-year from Rs. 1,225 crores in Q1 FY22 to Rs. 1,770 crores in Q1 FY23
- Other first-quarter revenue climbed 13.10% year-over-year to Rs. 1,856 crores from Rs. 1,641 crores in Q1 FY22.
Management’s Take
Mr. Sunil Duggal, Chief Executive Officer of Vedanta, stated that Vedanta has begun the fiscal year 2023 with a good performance, supported by our world-class assets and robust business strategy. Despite inflationary cost pressures, Vedanta achieved a record-breaking first quarter EBITDA of 10,741 crores and a net income of 5,592 crores. This year, Vedanta’s top priorities will be delivery on pledged volumes, timely execution of growth initiatives, value addition, vertical integration, and cost reduction across our main businesses, as well as proactive commodity price risk management. Vedanta redesigned ESG’s purpose as “Transforming for Good,” and they are continuing to implement it. Vedanta has increased the number of women in decision-making bodies to 29% and is one of the few Indian corporations to aggressively recruit members of the transgender community as part of our staff. He was also pleased to inform you that they will begin disclosing Scope 3 emissions as per the FY22 Sustainability report, three years earlier than their previously announced timetable. As an Indian private company, they showed great faith in the “Atmanirbhar Bharat Abhiyan” to create India self-sufficient. Vedanta is also one of the most significant contributors to the national treasury. It is pertinent to note that Vedanta is the only Indian private company generating 25% of India’s oil and gas production.
FAQs On Vedanta
-
What is Vedanta share price and what are the returns for Vedanta share?
Vedanta share price is INR 277.50 as of 21 September 2022. Vedanta has provided a return of approximately -7.89% in the past 1 year as on 21 September 2022.
-
What are the 52-week highs and lows of Vedanta share?
As on 21 September 2022:
52-wk high Rs 440.75
52-wk low Rs. 206.10
-
What are the key metrics to analyze Vedanta Share Price?
Key metrics to analyze any share price are: 52-week high, a 52-week low, 1-year return, 5-year return, etc.
-
Who are the competitors of Vedanta?
Competitors of Vedanta include Tata Steel, Coal India, JSW Steel, etc.
-
What is the market cap of Vedanta Share?
The market cap of Vedanta is 1.0 Lakh Crore as on 21 September 2022
Interested in how we think about the markets?
Read more: Zen And The Art Of Investing
Watch/hear on YouTube:
Start investing through a platform that brings goal planning and investing to your fingertips. Visit Kuvera.in to discover Direct Plans and Fixed Deposits and start investing today.
#MutualFundSahiHai #KuveraSabseSahiHai!
