Vedanta — Q4 FY26 earnings call

Call held 29 Apr 2026

Management summary

Vedanta Limited reported a landmark FY26, achieving record high revenue, EBITDA, and PAT, driven by strong volume growth and cost reductions across its diversified businesses. The company successfully executed significant growth capex and deleveraged its balance sheet ahead of its de-merger into six independent entities. While facing a tragic incident at its Athena power plant and some regulatory delays for mine approvals, Vedanta remains focused on strategic growth and value creation.

Highlights

  • Record high annual revenue of INR1.74 lac crores in FY26, up 15% YoY.

  • EBITDA of INR56,000 crore (up 29% YoY) and PAT of over INR 25,000 crore (up 22% YoY) in FY26.

  • Free cash flow pre-capex of INR 26,013 crore and Return on Capital Employed of 32% in FY26.

  • Leverage ratio brought down to 0.95x from 1.22x YoY, and borrowing cost reduced to 8.9%.

  • Successful commissioning of various multi-year projects, including alumina refinery expansion, new smelter at Balco, and new billet lines.

Concerns

  • Tragic incident at Athena power plant with no immediate timeline for resumption of operations.

  • Delays in regulatory approvals for Sijimali bauxite mine, impacting operational timelines.

  • Skill shortages impacting capital project execution in Zinc International.

Key financials

2 periods

Headline

  • Annual Revenue
    ₹1.74L Cr
    YoY +15%
  • Annual EBITDA
    ₹55,976 Cr
    YoY +29%
  • Annual PAT
    ₹25,096 Cr
    YoY +22%
  • Annual Free Cash Flow pre-capex
    ₹26,013 Cr
  • Annual Return on Capital Employed
    32%

Q4

  • Revenue
    ₹51,524 Cr
    YoY +29%
  • EBITDA
    ₹18,447 Cr
    YoY +59%
  • EBITDA Margin
    44%
  • PAT
    ₹9,352 Cr
    YoY +89%

What they filed

Q1 FY27: revenue up 53.6%, net profit up 77.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue37,634 17,063 16,686 15,754 18,747 −50%21,337 +25%24,609 +47%24,205 +54%
EBITDA9,828 5,013 5,246 4,276 4,915 −50%6,521 +30%7,559 +44%8,501 +99%
Net profit5,603 4,876 4,961 4,457 3,479 −38%7,807 +60%9,352 +89%7,918 +78%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Aluminium (FY26)
    ₹25,502 Cr EBITDA38% Margin2.9 million tons Alumina Production2.46 million tons Aluminium Production1,752 $/ton Hot Metal Cost
  • Zinc India (FY26)
    ₹22,056 Cr EBITDA56% Margin1.1 million tons Mined Metal Production627 metric tons Silver Production959 $/ton Cost of Production
  • Zinc International (FY26)
    2,25,000 tons Mined Metal Production— Gamsberg Volumes
  • Power (FY26)
    16.4 billion units Sales— Average NSR
  • Steel (Bokaro) (FY26)
    1.3 million tons Production10% Cost Reduction
  • Pig Iron (Goa) (FY26)
    8,95,000 tons Production
  • Iron Ore (FY26)
    6.2 million tons Production— Goa Production Growth18% Goa Operating Cost Reduction
  • Ferrochrome (FY26)
    1,01,000 tons Production19% Cost Reduction
  • Copper (FY26)
    2,82,000 tons Rod Production1,70,000 tons Cathode Production

Capital allocation

high confidence
  • Capex ₹14,918 Cr primarily financed through internal accruals
    • Growth capital in strategic projects across aluminium, zinc, oil and gas and power
    During the year, we deployed INR15,000 crores of growth capital in line with guidance, establishing a new benchmark in Vedanta's journey on project execution as the year marked successful commissioning of various multi-year projects, setting us up on a trajectory of multi-year growth. ... This capex is primarily financed through internal accruals, our free cash flow generation pre-capex of around INR26,000 crores, reflecting this strong operational performance.
  • Debt Net $5.5 Bn · 0.9× EBITDA Cost 8.9%
    • Repayment De-leveraged Vedanta India's balance sheet ₹7,370 Cr
    • Repayment De-leveraged VRL group level, including reduction of short-term facilities $1.5 Bn
    At Vedanta group level pre-de-merger, our leverage stands at 0.95x, reflecting resilient EBITDA and disciplined financial structuring. ... We have brought down VDL's borrowing cost below 9% at about 8.9 as we close the fiscal and 16% reduction in financing cost, which is more than INR1,563 odd crores with further reduction in the borrowing cost in sight in near future. ... So if you look at overall Vedanta right now, $5.5 billion net debt and debt to EBITDA almost 0.95. ... Vedanta Oil and Gas will have nil debt, so it will be debt-free company. Vedanta Iron and Steel will be close to net debt; it will have no debt more than $0.2 billion. That leaves aluminium, debt of almost $3.5 billion, and in aluminium debt to EBITDA ratio almost 1.3. ... Vedanta Limited's debt will be almost a billion, and there debt to EBITDA will be 0.4x.
  • Dividend ₹34/share (interim)
    We also rewarded our shareholders with a handsome dividend of INR34 per share.
  • M&A Critical Mineral Blocks Acquisition · Announced

    Expand into high-potential minerals for future and transition

    As at FY26 close, we had won bids for composite licenses on 10 blocks, which include those for gold as well as manganese, whilst the remaining eight blocks are for critical minerals.
  • M&A KCM (Konkola Copper Mines) Divestment · Pending regulatory

    Listing to unlock value

    We are in the process of having filed our S-1 with the SEC. We are currently in the third round of comments, but I'm sure you would all appreciate that we are in a quiet period in that regard, and as soon as we are able to come into the public, we'll actually give you an update on the overall process.

Guidance & targets

Cost

  • Copper Brand Fee Rate Cost · Post de-merger, fixed for next three years (till FY29) · High confidence 0.75%

    Previously 3% → 0.75%

    So the brand fee for copper from the current 3% will go down to 0.75% and that alone from India's viewpoint means higher EBITDA by 2.25%.

    — Mr. Ajay Goel

  • Alumina Cost Cost · Q2 FY27 · High confidence $740-750 per ton
    As of now, based on whatever cost we are seeing, we expect the cost to be around broadly 740, 750 in the quarter 2 of financial year '27.

    — Mr. Anup Agarwal

  • Aluminium Cost of Production Cost · FY27 · High confidence $1650-1700 per ton
    See aluminium cost of production no, again, if you have seen the guidance, we're guiding 1650 to 1700, okay?

    — Mr. Anup Agarwal

Profitability

  • Copper Business Margin Profitability · FY27 · High confidence 5%

    From 1% today

    There are various activities looking at the pricing environment; we do foresee the margin in the Copper business going from roughly 1%. right now, going to at least 5% in FY '27.

    — Mr. Ajay Goel

Capacity

  • Zinc International - Gamsberg Phase 2 Commissioning Capacity · Next quarter (Q1 FY27) · High confidence Commissioned
    The team is anticipating to commission in the next quarter and to have the plant ramped up for the rest of the year...

    — Ms. Deshnee Naidoo

Volume

  • Zinc International - Gamsberg Phase 2 Ramp-up Volume · 12-18 months from commissioning (Q1 FY27) · Medium confidence 12-18 months for full ramp-up
    A ramp-up for a plant of this size should be anywhere between 12 to 18 months; 15 months would be a best-in-class ramp-up.

    — Ms. Deshnee Naidoo

Operations

  • Kuraloi Coal Mine Start Operations · Within a month or so (Q1 FY27) · High confidence Operations start
    Now from here, probably in a month or so, we should start seeing the mining operations.

    — Mr. Anup Agarwal

Regulatory

  • Ghogharpalli Coal Mine FC Grant Regulatory · This quarter (Q1 FY27) · High confidence Granted
    We are also targeting FC in this quarter, and we remain committed to commission this block in the timelines that we've indicated last two quarters.

    — Mr. Anup Agarwal

  • Sijimali Bauxite Mine EC Grant Regulatory · Next month (May 2026) / H1 FY27 · High confidence Granted
    EC we're expecting next month, and hopefully in H1 we will see the mines opening.

    — Mr. Anup Agarwal

Exploration

  • Critical Minerals Exploration Decision-making Exploration · Within a year from now · High confidence Decision-making position
    In three of these blocks, the exploration is at an advanced stage and we are expecting to be in the decision-making position in a year from now.

    — Ms. Deshnee Naidoo

Portfolio Expansion

  • Adding 3 more metals to Vedanta's bottom line Portfolio Expansion · Around 2030 · Medium confidence 3 metals
    That means if we add 36 months of putting up projects of mining and smelting, we should look at somewhere around 2030 adding three more metals to the bottom line of Vedanta.

    — Mr. Arun Misra

Capacity Utilization

  • BALCO Expansion Ramp-up Capacity Utilization · Q1 FY27 · High confidence 25% of 105 KT/quarter
    So Q1 should be 25%, Q2 ramped up to 50%, Q3 75%, and as we go into the Q4, it will be 100%. Ashish.

    — Mr. Anup Agarwal

  • Lanjigarh Refinery Rated Capacity Capacity Utilization · Q1 FY27 · High confidence Achieved
    we will probably achieve the rated capacity in Q1, there we will achieve the rated capacity.

    — Mr. Anup Agarwal

What to watch in Q1 FY27

Gamsberg Phase 2 Commissioning

Next quarter (Q1 FY27)
Current 94% complete
Target Commissioned

Why it matters

Successful commissioning is key to Zinc International's volume growth and profitability targets.

The team is anticipating to commission in the next quarter and to have the plant ramped up for the rest of the year...

Risks & concerns

  • Tragic incident at Athena power plant

    high

    Incident in Unit 1 boiler, pressurized hot water/steam release, affecting workers; no immediate timeline for resumption of operations.

    Management acknowledged

  • Delays in regulatory approvals for mines

    medium

    Kuraloi, Ghogharpalli, Sijimali mines facing delays in EC/FC approvals, impacting operational start, partly due to administrative processes.

    Both acknowledged

  • Skill shortages for capital projects

    low

    Shortage of specific skill sets for specialized work (piping, instrumentation) impacting project execution, particularly in South Africa.

    Management acknowledged

Q&A highlights

4 direct
Dividend policy post-demerger for each entity Direct
So that is a one change that will entail post-de-merger. In that case, five companies' board, ran independently, will be free to design their own policies. ... From rule-based, it becomes principle-based. For example, right now there is a requirement to pay at least 30% profit as dividend. Going forward, board will have the flexibility; they can pay 30% or the amount as they deem fit in future.

Clarifies the shift from a prescriptive dividend policy to a more flexible, principle-based approach for each de-merged entity, impacting future shareholder returns.

Asked by Indrajit Agarwal

Addressing VRL's $4.7 billion debt post-demerger Partial
So at Vedanta Resources, the need for the loan in FY27 is almost USD0.3 billion. ... Now as we de-merge all the five companies, additionally we'll have the optionality of a differentiated capital structure and in that case, many anchor investors domestically and globally are very keen to come in the cap table, and that will be additional avenue for de-leveraging.

Provides insight into the immediate debt servicing needs for VRL and outlines potential strategies post-demerger, including differentiated capital structures and attracting new investors, beyond just brand fees and dividends.

Asked by Indrajit Agarwal

Zinc International Gamsberg Phase 2 expansion delays and confidence in current timeline Direct
In terms of the reasons for the delay, twofold. Firstly, to produce 8 million tons of run-of-mine, given the stripping ratio of 3 to 4 at this moment, we've had a lot to do on catching up of the waste stripping at the Gamsberg open pit, and that took the better part of the last two years to actually catch up. ... We've also had some delays on the ground, believe it or not, and something I think I as an industry keep talking around is skills needed for certain types of work, especially in projects.

Explains the specific operational and skill-related reasons for past delays in a key growth project and reiterates confidence in the current timeline, which is crucial for future volume growth.

Asked by Sumangal Nevatia

Copper segment profitability and brand fee reduction post-demerger Direct
So the brand fee for copper from the current 3% will go down to 0.75% and that alone from India's viewpoint means higher EBITDA by 2.25%. ... we do foresee the margin in the Copper business going from roughly 1%. right now, going to at least 5% in FY '27.

Details a significant change in the internal brand fee structure for the copper business, directly impacting its profitability and EBITDA contribution post-demerger, signaling a strategic move to improve segment margins.

Asked by Amit Lahoti

KCM listing plans and progress Partial
So we are in the process of having filed our S-1 with the SEC. We are currently in the third round of comments, but I'm sure you would all appreciate that we are in a quiet period in that regard, and as soon as we are able to come into the public, we'll actually give you an update on the overall process.

Provides an update on the progress of the KCM listing, indicating it's moving forward but still in regulatory review, which is a key value unlocking event.

Asked by Sumangal Nevatia

Athena power plant incident and restart timeline Partial
In terms of restart, I think we cannot commit to any timeline at this stage. What we can tell you is that we've only just recently, a couple of days ago, been actually given access back into the site to commence our full assessment work to look at, the activities, the rectification, restoration activities on the site.

Highlights the uncertainty surrounding the restart of the Athena power plant following a tragic incident, indicating potential impact on power sales and requiring further assessment.

Asked by Ritesh Shah

Delays in regulatory approvals for Sijimali bauxite mine Direct
So, sir, in Sijimali, obviously we were expecting earlier in February also, now we are expecting in May. So, what is the actual delay which we are facing? means, why government is not giving it, because we have seen lots of news in the newspaper, something in the local level also is disturbing. So, is this the reason because of which we are getting this delay in Sijimali mine? ... see there is some there was a LOI which got expired in the month of March. It was an administrative process, okay, it took some time before that LOI has been extended. We've just got the letter yesterday.

Addresses the specific reasons for the delay in Sijimali mine approvals, clarifying that it was due to an administrative process (LOI expiry and extension) rather than local disturbances, which is critical for future bauxite supply.

Asked by Ashish

3 min read 7 chapters

Detailed narrative

Record Financial Performance in FY26

Vedanta Limited achieved its best-ever financial performance in FY26, with record annual revenue of INR1.74 lac crores, marking a 15% year-on-year growth. EBITDA reached INR56,000 crore, up 29% YoY, and PAT exceeded INR25,000 crore, a 22% increase. The company also generated a robust free cash flow pre-capex of INR26,013 crore, contributing to a strong return on capital employed of 32%.

De-merger Progress and Capital Structure Optimization

The de-merger process is in its final stages, with May 1st set as the effective and record date. Shareholders will receive four additional shares for each Vedanta share held, with listing targeted for Q1 FY27. Post-demerger, the company aims for a differentiated capital structure for each of the five entities, with Vedanta Oil & Gas and Iron & Steel expected to be near zero net debt businesses. Vedanta Aluminium will carry approximately $3.5 billion in debt, with a debt-to-EBITDA ratio of 1.3x, while the continuing Vedanta Limited will have $1 billion debt and a 0.4x debt-to-EBITDA ratio.

Operational Excellence and Volume Growth Across Businesses

FY26 saw significant operational milestones, including record alumina production of 2.9 million tons (up 48% YoY) and aluminium production of 2.46 million tons. Zinc India achieved its highest-ever mined metal production of 1.1 million tons and lowest cost of $959 per ton. Zinc International's mined metal production increased 27% to 2,25,000 tons, driven by a 39% rise in Gamsberg volumes. Power sales grew 30% to 16.4 billion units, and the steel unit in Bokaro delivered its highest-ever annual production of 1.3 million tons.

Strategic Capital Expenditure and Growth Projects

Vedanta deployed INR15,000 crores in growth capital during FY26, marking a new benchmark in project execution. Key projects commissioned include the expansion of the Lanjigarh alumina refinery to 5 million tons per annum, a new 4,35,000-ton smelter at Balco, and new billet lines at Jharsuguda and Balco. The Gamsberg Phase 2 expansion is 94% complete and is expected to be commissioned in the next quarter, with a full ramp-up anticipated within 12-18 months.

Debt Reduction and Financial Strength

The company significantly strengthened its balance sheet, reducing its leverage ratio to 0.95x from 1.22x year-on-year. Vedanta Resources de-leveraged by approximately $1.5 billion, and Vedanta India's balance sheet saw a deleveraging of INR7,370 crores in Q4 FY26. The borrowing cost was brought down to 8.9%, representing a 16% reduction in financing costs, underscoring improved cash flow visibility and strategic financial management.

Critical Minerals and ESG Initiatives

Vedanta secured bids for 10 critical mineral blocks, including gold, manganese, and other critical minerals, with exploration in three blocks at an advanced stage. The company anticipates being in a decision-making position for these blocks within a year and aims to add three more metals to its bottom line by around 2030. On the ESG front, renewable energy consumption increased by 52% to 3.97 billion units in FY26, leading to a GHG intensity reduction from 6.02 to 5.43 tons of CO2 equivalent per ton of product.

Incident at Athena Power Plant and Safety Focus

A tragic incident occurred at the Athena power plant in Chhattisgarh on April 14th, involving a boiler in Unit 1, which resulted in the release of pressurized hot water and steam. Vedanta expressed deep condolences and is providing support to affected families. The company is working with authorities to establish facts and prevent re-occurrence, while also focusing on group-wide safety improvements, achieving a 16% reduction in lost time injuries and a 3% decrease in total recordable injury frequency rate in FY26.

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