Vedanta Aluminium Q2 Results: Profit doubles to Rs 6,187 crore, revenue jumps 41%

Vedanta Aluminium Metal on Wednesday reported a 105% year-on-year (YoY) jump in consolidated net profit to Rs 6,187 crore for the September quarter, compared with Rs 3,012 crore in the corresponding period last year, driven by record aluminium production, higher sales volumes and improved realisations.

Revenue from operations rose 41% to Rs 22,066 crore from Rs 15,670 crore a year earlier. EBITDA increased 83% to Rs 10,192 crore from Rs 5,582 crore, marking the second consecutive quarter in which operating profit exceeded Rs 10,000 crore.

On a sequential basis, net profit declined 6% from Rs 6,597 crore in the June quarter, while revenue increased 5% from Rs 21,105 crore. EBITDA fell 3% from Rs 10,499 crore.

The company's EBITDA margin expanded to 46% from 36% in the year-ago quarter, although it moderated from 50% in the preceding quarter.

Profit before exceptional items rose 117% YoY to Rs 6,550 crore. The company recorded an exceptional charge of Rs 363 crore, net of tax, during the September quarter.

Vedanta Aluminium attributed its strong annual performance to higher production, an improved sales mix, favourable currency movements and lower production costs.

Aluminium production hits record high
The company reported its highest-ever quarterly aluminium production of 649,000 tonnes, up 5% from 617,000 tonnes a year earlier and 3% from 632,000 tonnes in the June quarter.

Production at its Jharsuguda facility reached 470,000 tonnes, while BALCO's output increased 19% YoY to 178,000 tonnes.

Value-added aluminium production rose 31% to a record 432,000 tonnes, reflecting the company's efforts to increase the share of higher-value products.

Alumina production at its Lanjigarh refinery also reached a quarterly record of 895,000 tonnes, registering 37% YoY growth.

The company's aluminium production cost declined 6% to $1,722 per tonne from $1,826 per tonne in the corresponding period last year. However, costs increased 1% sequentially.

The benchmark London Metal Exchange aluminium price averaged $3,226 per tonne during the quarter, compared with $2,618 a year earlier.

Capacity expansion and integration projects
Vedanta Aluminium continued to advance its expansion projects during the quarter, including operationalising the second zone of BALCO's 435,000-tonne annual capacity expansion.

The company also obtained consent to operate for its Sijimali bauxite mine, an important step towards securing domestic raw material supplies.

Its Lanjigarh refinery is targeting alumina production exceeding one million tonnes in the December quarter.

The company expects domestic bauxite to account for more than 90% of its raw material mix by the end of FY27, compared with 37% during the September quarter.

"Our performance this quarter reflects the continued momentum in scaling Vedanta Aluminium into a globally competitive, integrated aluminium business," said Rajesh Kumar, Whole-Time Director and CEO of Vedanta Aluminium.

He added that record production and progress on bauxite resources would support the company's expansion plans.

Net debt declines by Rs 3,090 crore
Vedanta Aluminium also reported an improvement in its balance sheet, with consolidated net debt declining by Rs 3,090 crore to Rs 26,442 crore as of September 30, from Rs 29,532 crore at the end of June.

Its net debt-to-EBITDA ratio improved to 0.7 times from 0.9 times in the preceding quarter. Cash and cash equivalents stood at Rs 6,318 crore, while consolidated gross debt was Rs 32,800 crore.

Finance costs declined 4% YoY to Rs 911 crore from Rs 949 crore, supported by lower average borrowings.

Anup Agarwal, CFO of Vedanta Aluminium, said disciplined cash generation and capital management helped the company reduce debt while continuing investments in expansion projects.