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Published: May 12, 2023
Updated: May 12, 2023

Vedanta Reports Decline in Q4 Profits, Announces Dividend; Focuses on Renewable Energy and Expansion

Vedanta, led by Anil Agarwal, released its Q4FY23 results, showcasing a significant decline in profits. Despite this, the mining major remains committed to its growth plans, with a focus on renewable energy initiatives and expanding its operations. The company's board also declared substantial dividends for the fiscal year, providing value to its shareholders. Let's delve into the details.

Financial Performance:

Vedanta recorded a year-on-year decline of 56.3% in net profit for Q4, amounting to ₹2,634 crore, compared to ₹6,027 crore in the same period last year. The company's revenue dropped 5.4% to ₹37,225 crore from ₹39,342 crore in the year-ago period. The earnings before interest, taxes, depreciation, and amortization (EBITDA) decreased by 33.4% to ₹8,754 crore.

Dividend Declaration:

The company's board of directors approved the declaration of fourth and fifth interim dividends for fiscal year 2022-23. These dividends amount to ₹12.50 and ₹20.50 per equity share, respectively, representing significant percentages on the face value of Re 1 per equity share. The total dividend declared for FY23 stands at ₹101.50 per equity share. Additionally, an interim dividend of ₹33 per share for Q4 was announced.

Management Re-appointments:

Vedanta announced the re-appointment of Navin Agarwal as the whole-time director of the company for a period of five years, effective from August 1, 2023, to July 31, 2028, subject to shareholder approval. The re-appointment of Priya Agarwal as a non-executive director for five years, starting from May 17, 2023, to May 16, 2028, was also confirmed.

Record-breaking Achievements:

During FY23, Vedanta achieved noteworthy milestones. The company recorded its highest- ever aluminium production, reaching 2,291 kt, indicating a 1% increase due to the Jharsuguda ramp-up. The Zinc India business achieved a record mined metal production of 1,062 kt, marking a 4% year-on-year growth.

Renewable Energy and Sustainability Efforts:

Vedanta's commitment to sustainable practices is evident through its focus on renewable energy. The company finalized 1868 MW renewable power delivery agreements, taking a significant step towards its goal of becoming carbon neutral by 2050 or sooner. This emphasis on renewable energy aligns with Vedanta's mission to contribute to a greener and more sustainable future.

Segmental Performance:

While Vedanta experienced a decline in revenue for the zinc, lead, and silver segments, the copper and iron ore segments witnessed positive growth. Zinc, lead, and silver revenue fell by 4% to ₹8,254 crore, whereas aluminum revenue declined by 19.8% to ₹12,396 crore.

Expansion Plans:

As part of its oil and gas segment, Vedanta signed a 10-year extension to a production sharing contract for the Rajasthan oil block. The company has also estimated a higher capex of $1.7 billion for FY23, focusing on expanding its operations and driving future growth.

Vedanta's Q4 results reflect a decline in profits; however, the company remains resilient and committed to its long-term growth strategy. By concentrating on renewable energy initiatives and expanding its operations, Vedanta is poised to embrace a sustainable and greener future. The board's declaration of substantial dividends demonstrates the company's dedication to creating value for its shareholders.