Vedanta Q1 Results: Margin expands in first post-demerger earnings despite muted revenue

Vedanta Ltd. reported a resilient set of earnings in its first quarterly results since completing its demerger, with stronger operating profitability and improved margins helping offset a marginal decline in revenue. The performance reflected healthy execution across its diversified metals and mining portfolio, while continued debt reduction added to investor confidence.

Profit for the June quarter stood at ₹5,294 crore, compared with ₹4,267 crore in the preceding quarter. Revenue eased 1.6% sequentially to ₹24,205 crore from ₹24,609 crore, but higher operational efficiency helped drive earnings.

EBITDA rose 13% quarter-on-quarter to ₹8,501 crore from ₹7,559 crore, while EBITDA margin expanded sharply to 35.1% from 30.7%, signalling improved profitability despite softer topline growth.

The Street responded positively to the numbers, with Vedanta shares climbing to an intraday high of ₹269.70, up around 2% on the NSE following the earnings announcement.

Operationally, several businesses delivered record or near-record performances. Zinc India posted its highest-ever first-quarter mined metal production at 268 kt, while refined metal production increased 4% year-on-year to 260 kt. The business also reported its lowest zinc cost of production since transitioning underground, with costs falling 16% year-on-year to 851 dollars per tonne.

Elsewhere, FACOR recorded its highest-ever ore production of 153 kt, up 41% year-on-year, alongside a 4% increase in ferrochrome production. The Copper India business registered its highest first-quarter sales in eight years, while the company's ports business reported record discharge volumes of 2,358 kt, up 40% from a year ago.

Not every business enjoyed similar momentum. Zinc International's mined metal production declined 14% year-on-year as the Deep mine at Black Mountain nears the end of its operational life, while copper rod sales at the Fujairah facility were impacted by disruptions arising from the closure of the Strait of Hormuz.

Commenting on the performance, Executive Director Arun Misra said the company had delivered "a strong start to FY27", highlighting record performances across Zinc India, FACOR and Copper India, while noting that Gamsberg Phase 2 remains on track to commence production this quarter. He said the results reflected Vedanta's continued focus on volume growth, cost efficiency and value creation.

Also Read: Vedanta announces yet another demerger after splitting four units; Details here

Separately, Vedanta also announced the demerger of its real estate business into a separate listed entity on a going concern basis, marking another step in its ongoing restructuring exercise. The move comes barely two months after the company listed four demerged entities and is aimed at creating focused, independently managed businesses that can pursue their own growth strategies and unlock shareholder value.

Group CFO Ajay Goel said the demerger had already begun unlocking shareholder value, with the combined market capitalisation of the resulting companies increasing by more than ₹71,000 crore during the first quarter. He added that Vedanta reduced its net debt by ₹2,223 crore during the quarter, helping secure AA+/Stable credit rating upgrades from both ICRA and CRISIL.