Strong Profit Growth Driven by Aluminium, Zinc Volumes and Cost Optimisation
Vedanta reported a remarkable 154% rise in consolidated net profit to ₹3,483 crore for the quarter ended March 31, 2025 (Q4FY25), driven by higher aluminium and zinc volumes coupled with the company’s cost optimisation measures. The mining conglomerate had posted a much lower profit of ₹1,369 crore in the same quarter the previous year. This sharp profit surge highlights the resilient performance across key segments, despite the global commodity inflation in key raw materials.
Highlights:
Q4FY25 net profit surged by 154% YoY to ₹3,483 crore.
Growth driven by increased aluminium and zinc volumes and cost-saving measures.
A stark improvement from the ₹1,369 crore profit in Q4FY24.
Revenue Growth Reflects Robust Performance, Despite Commodity Inflation
Vedanta’s consolidated total revenue from operations grew by 14% YoY to ₹40,455 crore in Q4FY25, compared to ₹35,509 crore in Q4FY24. This increase in revenue is attributed to higher production volumes and pricing across key metals. On a sequential basis, the revenue also saw a 3.4% increase from ₹39,115 crore in the previous quarter, signalling consistent growth momentum. In line with revenue, total income also rose 14% YoY, reaching ₹41,216 crore during the quarter.
Despite this top-line growth, the company’s total expenses rose to ₹34,560 crore from ₹31,899 crore in the corresponding period of the previous year, largely due to commodity inflation in raw materials such as oil and metals.
Highlights:
Total revenue for Q4FY25 grew 14% YoY to ₹40,455 crore.
Sequential growth of 3.4% over the previous quarter.
Total expenses increased to ₹34,560 crore due to rising raw material costs.
EBITDA Rises 30% YoY, EBITDA Margin Expands by 465 Basis Points
Vedanta reported a 30% YoY increase in consolidated EBITDA, which stood at ₹11,618 crore for Q4FY25, highlighting strong operational efficiency and cost management. The company’s EBITDA margin expanded by 465 basis points YoY to 35%, signaling improved profitability even amid challenges in global commodity markets.
Highlights:
EBITDA increased by 30% YoY to ₹11,618 crore.
EBITDA margin expanded to 35%, up 465 basis points YoY.
Net Debt and Debt-to-EBITDA Ratio
The company reported a net debt of ₹53,251 crore as of the end of the quarter, with a Net Debt to EBITDA ratio of 1.2x, reflecting a manageable leverage position. While the company has been focused on growth through strategic investments, maintaining healthy debt metrics remains crucial in an environment of rising global interest rates and fluctuating commodity prices.
Highlights:
Net debt stood at ₹53,251 crore.
Debt-to-EBITDA ratio remains at 1.2x, indicating manageable leverage.
Share Performance and Market Reaction
Vedanta’s stock reacted mildly to the earnings announcement, with shares dropping 0.13% to ₹415.75 on the NSE. Despite the impressive profit growth, market participants appear to be factoring in the volatility and risks associated with commodity price fluctuations and operational challenges across various segments. This stock movement suggests that the market may be awaiting more clarity on the company’s future earnings potential and the trajectory of its de-merger plans.
Highlights:
Vedanta’s shares dropped 0.13%, closing at ₹415.75 on the NSE.
Market reaction reflects caution despite strong profit growth.
Segment-wise Performance: Zinc and Aluminium Shine, Oil and Gas Decline
Zinc, Lead, and Silver Segment
Vedanta’s zinc, lead, and silver business reported a 21% YoY rise in revenue to ₹8,805 crore for Q4FY25, driven by strong domestic demand and a reduction in production costs. EBITDA from this segment surged 33% YoY to ₹4,811 crore, reinforcing the company’s position as a key player in the global zinc market.
Aluminium Segment
The aluminium business saw a 29% YoY increase in revenue, reaching ₹15,967 crore in Q4FY25, primarily due to higher volumes and improved product pricing. This performance reflects Vedanta’s ongoing commitment to expanding its aluminium capacity, especially in the face of rising global demand for lighter materials in industrial applications.
Iron Ore Segment
On the downside, iron ore revenue declined by 38% YoY in Q4FY25, reflecting lower demand and pricing pressure in the global iron ore market.
Oil & Gas Segment
Vedanta’s oil and gas unit posted a 21% YoY decline in revenue to ₹2,658 crore, with EBITDA falling 20% YoY to ₹1,212 crore. This was driven by lower oil discoveries and a decline in daily production. Average daily gross operated production dropped by 18% YoY, further challenging the segment’s profitability.
Highlights:
Zinc, Lead & Silver: 21% revenue rise, 33% EBITDA growth.
Aluminium: 29% YoY revenue growth, buoyed by strong volumes.
Iron Ore: Revenue dropped 38% YoY.
Oil & Gas: Revenue declined 21%, driven by lower oil discoveries.
Outlook and De-merger Plans
Vedanta’s executive director, Arun Misra, outlined the company’s growth and transformation strategy for FY26. The company remains focused on cost efficiency and volume expansion with key projects such as the Lanjigarh Expansion and Sijimali Bauxite Mine scheduled for completion. The company has also indicated that its de-merger process will likely be completed by September 2025, marking a pivotal point in the company’s restructuring efforts.
Highlights:
Lanjigarh Expansion and Sijimali Bauxite Mine projects expected to enhance cost efficiency.
De-merger expected to be completed by September 2025.
