vedanta iron & steel reported a consolidated net profit of ₹121 crore for the first quarter ended June 30, 2026 (Q1FY27), marking a significant turnaround from a net loss of ₹145 crore in the corresponding quarter of FY26. The company’s revenue from operations grew by 18.8% year-on-year to ₹3,662 crore, driven by increased production volumes and improved pricing in its core steel and iron ore businesses. This result follows the recent demerger of Vedanta Limited’s iron ore undertaking into the company, which became effective on May 1, 2026. The Board of Directors approved the unaudited financial results at a meeting held on July 29, 2026.

The statutory auditors, M/s S.R. Batliboi & Co. LLP, issued an unmodified limited review report on the consolidated and standalone financial statements in compliance with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were prepared in accordance with Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013.

Financial Performance Highlights

The company’s total income stood at ₹3,751 crore, compared to ₹3,340 crore in Q1FY26. While total expenses increased to ₹3,586 crore from ₹3,428 crore in the prior year period, the reduction in finance costs helped improve the bottom line. Finance costs dropped significantly to ₹207 crore in Q1FY27 from ₹461 crore in Q1FY26, contributing to a pre-tax profit of ₹165 crore versus a loss of ₹88 crore in the comparable period. The effective tax rate (ETR) for Q1FY27 was 32%.

Segment-wise, the steel business contributed ₹2,839 crore to segment revenue, up from ₹2,428 crore in Q1FY26, while the iron ore segment generated ₹1,190 crore against ₹1,029 crore previously. The combined EBITDA from continuing operations rose to ₹515 crore from ₹335 crore, reflecting operational efficiencies. On a standalone basis, Vedanta Iron and Steel reported a net profit of ₹185 crore for Q1FY27, compared to a profit of ₹225 crore in Q1FY26. Standalone revenue from operations was ₹1,512 crore, up 15.8% YoY.

Operational Updates

Steel saleable production reached 582 KT, up 4% YoY, while sales volumes grew by 9% YoY. Steel margins expanded by 60% YoY, with margin per tonne increasing by 388 basis points. Iron ore production stood at 2.6 million dry metric tons (DMT), up 4% YoY, with merchant sales rising 2% YoY. The company maintains an AA/Stable credit rating from CRISIL. Net debt to EBITDA ratio stands at 1.3x, excluding inter-company loans of ₹960 crore. Cash and cash equivalents, including restricted fixed deposits of ₹352 crore, totaled ₹1,018 crore.

What the Numbers Show

The most notable aspect of Q1FY27 results is the dramatic improvement in profitability despite a modest increase in total expenses. The surge in net profit is primarily attributable to a substantial decrease in finance costs, which fell by over 55% year-on-year due to the settlement of inter-company payables as per group demerger adjustments. Additionally, interest income reduced by 67% YoY due to the elimination of inter-division receivables under the Vedanta-approved demerger scheme. The absence of exceptional items in the current quarter, unlike the prior year which saw exceptional losses due to asset impairments and regulatory provisions, further aided the turnaround. The company also recorded a small profit of ₹10 crore from discontinued operations (Port Business at Visakhapatnam), compared to ₹22 crore in Q1FY26.

The Board of Directors of Vedanta Iron & Steel approved the formulation of the Vedanta Iron And Steel Limited Employee Stock Option Plan 2026 (VISL ESOP 2026) and the Vedanta Iron And Steel Limited Employee Stock Purchase Plan 2026 (VISL ESPP 2026) on July 29, 2026. The dual-scheme approach allows eligible employees to acquire equity shares, aligning their interests with long-term value creation. The total pool covers up to 5% of the company’s paid-up share capital, split between options granted at face value and shares offered at nil or determined prices. Implementation requires subsequent shareholder approval.

The disclosure was made under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with SEBI circular HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026. The Nomination & Remuneration Committee recommended the plans to the Board, which met from 03:50 p.m. IST to 04:28 p.m. IST. The schemes comply with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

Scheme Structure and Allocation

The VISL ESOP 2026 permits grants of up to 16,62,04,184 shares, representing 4.25% of the total paid-up share capital. The exercise price is set at the face value of ₹ 1 per share, or such other price as approved by law. Options vest between one and five years from the grant date, contingent on performance parameters set by the Nomination & Remuneration Committee. Once vested, options must be exercised within eight months.

The VISL ESPP 2026 covers up to 2,93,30,150 shares, or 0.75% of the paid-up capital. The purchase price per share is nil or as determined by the committee. Shares transferred to employees under this plan carry a one-year lock-in period from the date of transfer.

Eligibility and Trust Implementation

Both schemes are open to eligible employees of Vedanta Iron And Steel Limited, its holding company, and subsidiaries. Promoters, promoter group members, independent directors, and persons holding more than 10% equity are excluded. The schemes will be implemented through the Vedanta Iron And Steel Limited ESOS Trust (VISL ESOS Trust), which will acquire existing equity shares via secondary acquisition from the open market. The total shares held by the trust under all outstanding schemes must not exceed 5% of the paid-up equity share capital at any time. No grants or offers have been made under either scheme as of the filing date.