Vedanta Limited delivered its strongest quarterly performance in history during Q1FY27, reporting a consolidated profit after tax (PAT) of ₹5,294 crore, up 152% year-on-year and 24% quarter-on-quarter. The Mumbai-based metals and mining major achieved this milestone through a combination of record operational output, favorable London Metal Exchange (LME) prices, and significant forex gains. The company’s net debt was reduced by ₹2,223 crore in the quarter, strengthening its balance sheet and prompting both ICRA and CRISIL to upgrade its credit rating to AA+/Stable.

The Board of Directors approved the unaudited consolidated financial results on July 30, 2026. The filing, submitted to the Bombay Stock Exchange and National Stock Exchange of India, outlines the financial position of Vedanta Limited’s continuing operations following its demerger. The results exclude the copper business from certain margin calculations but include its revenue and profit contributions in the consolidated totals. Management highlighted that the combined market capitalization of all demerged entities grew by over ₹71,000 crore in the quarter, reflecting substantial value unlock for shareholders.

Financial Performance

Consolidated revenue from operations stood at ₹23,456 crore, representing a 51% increase year-on-year but a slight 1% decline quarter-on-quarter. The primary driver for the top-line growth was higher LME prices, premiums, and positive foreign exchange movements. Consolidated EBITDA reached an all-time high of ₹8,469 crore, up 98% year-on-year and 9% quarter-on-quarter. This translated into an EBITDA margin of 57%, which expanded by 985 basis points compared to the same period last year. Finance costs remained controlled at ₹662 crore, while depreciation and amortization totaled ₹1,192 crore.

Operational Highlights

Operational execution remained robust across key business units. Zinc India recorded its highest-ever first-quarter mined metal production at 268 kt, up 1% year-on-year, with refined metal production at 260 kt. Notably, Zinc India achieved its lowest cost of production post-underground transition at $851 per tonne, a 16% improvement year-on-year. In contrast, Zinc International saw mined metal production decline by 14% to 48 kt due to the nearing end-of-life at the Deep’s mine at Black Mountain, though Gamsberg’s production remained flat at 45 kt.

FACOR delivered record ore production of 153 kt, up 41% year-on-year, alongside ferrochrome production of 29 kt. The Vizag General Cargo Berth (VGCB) also performed strongly, with record discharge volumes of 2,358 kt, up 40% year-on-year. Copper India recorded its highest first-quarter plant sales in eight years at 53 kt, although Fujairah operations faced supply chain disruptions due to the closure of the Strait of Hormuz, leading to a 51% drop in rod sales.

What the Numbers Show

The most striking aspect of Vedanta’s Q1FY27 results is the divergence between revenue stability and profit explosion. While revenue dipped slightly by 1% quarter-on-quarter, PAT surged by 24% in the same period. This indicates a significant operating leverage effect, where cost efficiencies and price premiums disproportionately benefited the bottom line. Furthermore, the expansion of the EBITDA margin by nearly 10 percentage points year-on-year suggests that the company is capturing more value per unit of sales, likely due to the mix shift towards higher-margin products and effective cost management in the zinc segment. The reduction in net debt to just 0.3x EBITDA underscores a strategic pivot towards deleveraging, enhancing financial resilience without compromising growth capex of ₹1,148 crore.

Balance Sheet and Credit Ratings

Vedanta Limited ended the quarter with a strong liquidity position, holding cash and cash equivalents of ₹19,992 crore against gross debt of ₹28,291 crore. This resulted in a net debt of ₹8,299 crore, yielding a best-in-class net debt-to-EBITDA ratio of 0.30x. The overall borrowing cost was reduced to less than 8.5% per annum. At the parent level, Vedanta Resources Limited (VRL) also strengthened its profile, raising $1.75 billion in international bonds at an average coupon rate of 7.4% and securing a syndicated term loan of $2.25 billion. Consequently, VRL received rating upgrades from S&P, Fitch, and Moody’s, achieving its highest ratings since 2014.

Vedanta Aluminium Metal declared its first interim dividend of ₹8 per equity share for the financial year 2026-27, amounting to approximately ₹3,128.55 crore. The Board of Directors set August 5, 2026, as the record date for determining entitlements. This payout follows a strong start to FY27, where consolidated EBITDA surged to ₹10,499 crore in Q1FY27, up from ₹4,479 crore in the corresponding period last year.

The announcement was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, following a board meeting held on July 30, 2026. Alongside the dividend approval, the Board formulated and adopted two new employee benefit schemes: the Vedanta Aluminium Metal Limited – Employee Stock Option Plan 2026 (VAML ESOP 2026) and the Employee Share Purchase Plan 2026 (VAML ESPP 2026). These initiatives aim to align employee interests with long-term value creation.

Dividend and Shareholder Details

The interim dividend is payable on equity shares with a face value of ₹1 each. The payment will be made within the timelines prescribed by law following the record date. This distribution reflects the company's robust cash generation capabilities post-demerger from Vedanta Limited, which became effective on May 1, 2026.

Employee Stock Benefit Schemes

The Board approved the VAML ESOP 2026 and VAML ESPP 2026, subject to shareholder approval. Together, these schemes cover up to 5% of the total paid-up share capital. The ESOP pool comprises up to 16,62,04,184 shares (4.25% of paid-up capital), while the ESPP pool includes up to 2,93,30,150 shares (0.75% of paid-up capital).

Both schemes will be implemented through the Vedanta Aluminium Metal Limited ESOS Trust via secondary acquisition from the open market. The Trust's holdings under all outstanding schemes must not exceed 5% of the paid-up equity share capital at any time. Eligible employees include staff from the company, its holding company, and subsidiaries, excluding promoters, promoter groups, independent directors, and persons holding more than 10% equity.

Scheme Terms

Under the VAML ESOP 2026, options vest between one and five years from the grant date, based on performance parameters set by the Nomination & Remuneration Committee. The exercise price is proposed at the face value of ₹1 per share. Options may be exercised within eight months of vesting. For the VAML ESPP 2026, the purchase price is nil or as determined by the committee, with a lock-in period of one year from the date of transfer.

Financial Performance Context

The dividend declaration coincides with reported consolidated revenue from operations of ₹21,393 crore for Q1FY27, an increase from ₹14,654 crore in Q1FY26. The following table summarises the key financial metrics for the period: