Q3FY21 Company Update - Vedanta - ICICI Direct

Vedanta reported a steady set of Q3FY21 numbers. Topline for the quarter was at Rs. 22735 crore, up 6% YoY, 8% QoQ. EBITDA came in at Rs. 7757 crore, up 19% both QoQ as well as YoY. EBITDA margin came in at 34.1% vs. 30.5% in Q3FY20. Ensuing attributable PAT (before exceptional items and tax on dividend) for the quarter was at Rs. 3017 crore, up 51% QoQ, 35% YoY. For the quarter, topline growth was primarily supported by higher commodity prices. Aluminium division reported sales volume of 497 KT, up 5% QoQ. CoP for the aluminium division was at US$1387/tonne (US$1691/tonne in Q3FY20, US$1288/tonne in Q2FY21) while EBITDA margin for the aluminium division was at 28%. Zinc International's Gamsberg posted highest ever quarterly production of 43 KT, up 39% YoY, 23% QoQ. With respect to oil & gas vertical, average daily gross operated production was at 160 kboepd, down 3% QoQ. On the steel business, the company reported highest ever hot metal production of 372 KT (since acquisition of Electrosteel), while EBITDA/tonne of the steel business was at US$111/tonne, up 18% QoQ.

Valuation & Outlook

Vedanta's earnings remain sensitive to movement in commodity prices. The improvement in major commodity prices over the last couple of quarters augurs well for the company. We value the stock on a SoTP basis and arrive at a target price of Rs. 180 (earlier target price of Rs. 100). We maintain our HOLD rating on the stock.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Vedanta_CoUpdate_Feb21.pdf

Shares of Vedanta Limited was last trading in BSE at Rs.177.85 as compared to the previous close of Rs. 174.35. The total number of shares traded during the day was 1020762 in over 2907 trades.

The stock hit an intraday high of Rs. 179 and intraday low of 175.55. The net turnover during the day was Rs. 181678924.

Source : Equity Bulls

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