Lloyds Metals & Energy Limited has reported robust financial results for the first quarter, marking significant milestones in its growth trajectory.

Financial Highlights

The company's total income for Q1 stood at INR 24,084.00 crore, remaining flat year-on-year but showcasing an impressive 99% sequential growth. EBITDA saw a 12% year-on-year increase to INR 8,087.00 crore, with margins expanding to 33.60%. Profit after tax grew by 14% year-on-year to INR 6,346.00 crore.

Operational Performance

Iron ore sales volume for the quarter reached 3.45 million tons, up 2% year-on-year and 107% quarter-on-quarter. The average realization stood at INR 6,061.00 per ton, a 6% increase year-on-year. EBITDA per ton for iron ore improved to INR 2,223.00, marking a 20% year-on-year and 46% quarter-on-quarter increase.

Strategic Developments

Lloyds Metals & Energy has made significant strides in expanding its operations:

1. Successfully commissioned a 4 million ton pellet plant and pipeline at Konsari.
2. Received environmental clearance to expand mining capacity from 10 million tons to 55 million tons per annum.
3. Completed acquisition of remaining MDO operations, enhancing cost efficiency and long-term profitability.
4. Made strategic investments in two pellet plants:
   • 19.40% stake in Mandovi River Pellets Private Limited
   • 49% stake in Brahmani River Pellets Limited

Future Outlook

The company remains confident in achieving its 22 million tons iron ore production guidance. It projects pellet capacity to reach 13.50 million tons next year from the current 9.50 million tons.

Rajesh Gupta, Managing Director, commented, "Q1 has been a fantastic quarter of milestones for us. We are now well-geared to cater to both domestic and export markets for pellets."

Capital Expenditure and Financial Strategy

Lloyds Metals & Energy plans to invest approximately INR 7,500.00 to 8,000.00 crore annually over the next three years for ongoing expansion projects. The company maintains a robust balance sheet with strong operating cash flows and prudent capital allocation.

Market Outlook

The domestic iron ore pellet market remains strong, supported by robust steel demand and capacity expansions across India. Steel demand continues to grow at 8-9%, driving sustained iron ore uptake.

As Lloyds Metals & Energy Limited continues to execute its growth strategy, it remains well-positioned to capitalize on the strong demand in the Indian steel and iron ore markets.

Lloyds Metals & Energy Limited (LMEL) has received strong credit ratings from two prominent agencies for its various financial instruments totaling Rs 6,000.00 crore, signaling robust financial health and creditworthiness.

Dual Agency Ratings

India Ratings and Research Private Limited (India Ratings) and Crisil Ratings Limited have both assigned 'AA' ratings with a stable outlook to LMEL's debt instruments, indicating a high degree of safety regarding timely servicing of financial obligations and very low credit risk.

Breakdown of Rated Instruments

India Ratings has affirmed and assigned the following ratings:

Crisil Ratings has assigned the following ratings:

Term Loan Details

The term loans, totaling Rs 1,000.00 crore, are from two major banks:

• ICICI Bank: Rs 750.00 crore
• Axis Bank: Rs 250.00 crore

One of the term loans has a maturity date of February 10, 2027.

Significance of AA Ratings

Both rating agencies emphasize that the 'AA' rating indicates a high degree of safety regarding timely servicing of financial obligations. This rating suggests that LMEL carries very low credit risk, which is likely to boost investor confidence and potentially lead to favorable borrowing terms for the company.

Company's Financial Outlook

The strong credit ratings across various debt instruments, including bonds, term loans, and non-convertible debentures, reflect LMEL's solid financial position and its ability to meet its financial commitments. This positive assessment from two reputable rating agencies may enhance the company's standing in the financial markets and could potentially lead to improved access to capital at competitive rates.

Regulatory Compliance

In line with regulatory requirements, LMEL has promptly informed the stock exchanges about these credit ratings, demonstrating its commitment to transparency and compliance with listing obligations.

The assigned ratings are a significant development for Lloyds Metals & Energy Limited, potentially impacting its financial strategies and future growth plans. Investors and market watchers will likely keep a close eye on how the company leverages these positive ratings in its upcoming financial decisions and capital raising activities.