Vedanta Limited · NSE:VEDL
Vedanta — Investor Presentation (February 2018)
28 slides from Vedanta's investor presentation, February 2018
Slide 1: Vedanta Limited Investor Presentation
Vedanta Limited Investor Presentation February 2018 Elements for a Sustainable Future VEDANTA LIMITED – OIL & GAS | ZINC | POWER | ALUMINIUM | IRON ORE | COPPER VEDANTA LIMITED – Investor Presentation, Feb 2018
Slide 2: Cautionary Statement and Disclaimer
Cautionary Statement and Disclaimer The views expressed here may contain information derived from statement involves risk and uncertainties, and that, although we publicly available sources that have not been independently verified. believe that the assumption on which our forward-looking statements
Slide 3: Vedanta - A world-class natural resources powerhouse
Vedanta - A world-class natural resources powerhouse Overview Group Structure Vedanta Resources Plc • World’s 6th largest diversified 50.1% resources company and the largest in India 79.4% • Only global player with significant Konkola Copper Mines (KCM) Vedanta Ltd2 operations, expertise and majorit
Slide 4: A diversified resources company with attractive commodity mix and strong balance sheet
A diversified resources company with an attractive commodity mix, market leading growth and strong balance sheet Commodity diversification1 Attractive commodity mix Global demand CAGR 2017-30E Aluminium 2.8% 83% of O&G India 2.2% Vedanta’s Lead 2.2% Q3 FY18 EBITDA Zinc 2.0% Peers2 Nickel 1.6% Copper
Slide 5: Vedanta Businesses
Vedanta Businesses Zinc – India • India’s only miner of Zinc-Lead, and the world’s second largest integrated Zinc- Lead producer • Assets in South Africa and Namibia Zinc Intl. • Gamsberg in South Africa is one of the world’s largest undeveloped zinc deposits • India’s largest private sector oil pro
Slide 6: Well invested asset base delivering growth and shareholder returns
Well invested asset base delivering growth and shareholder returns Consistent and successful strategy Delivering profitable capacity growth in attractive commodities Uniquely positioned to harness India’s resources potential and demand growth Clear priorities for capital allocation and shareholder r
Slide 7: Capital Allocation: Focus on Shareholder Returns
Capital Allocation: Focus on Shareholder Returns World class assets and operational excellence to deliver strong and sustainable cash flows Production growth and asset optimization Strong Shareholder Returns Maintain Strong Balance Sheet Grow Existing Businesses • Announced dividend policy at • Cont
Slide 8: Strategic Framework
Strategic Framework Near Term Priority Medium Term Priority (FY18-20) (FY20+) Deliver Selectively pursue growth Ramp up to Design Capacity superior options shareholders Well-invested assets ramping High quality portfolio with up by FY2020 to deliver attractive brownfield growth returns with indu
Slide 9: Near Term Priority: Ramp-up to Design Capacity
Near Term Priority: Ramp-up to Design Capacity Near-term expansions Total expanded capacity Progress Zinc Expansion to 1.2mt mined Zn-Pb metal 1.2mt Zn-Pb India Silver to 750t 750t Ag Zinc Gamsberg project (250kt) and Skorpion pit 400kt Intl. extension Various projects at Rajasthan - EOR, ti
Slide 10: Medium Term Priority: Selectively Pursue Growth Options
Medium Term Priority: Selectively Pursue Growth Options Future growth options Zinc Expansion of Zn-Pb to 1.5mtpa India Silver production of 1,000t + Zinc Gamsberg Phase 2 & 3 (350kt incremental) Intl. Swartberg (75kt) 300-500 kboepd Oil & Gas Accompanied by continued exploration Aluminiu
Slide 11: Sustainable Development
Sustainable Development Safety LTIFR – (per million man-hours worked) Third party Safety Maturity Survey conducted Risk workshops will be conducted in Feb to validate and 0.89 manage Critical Risks Controls Regrettably 4 fatalities occurred during Q3 – each has been 0.52 0.49 investigated an
Slide 12: Business Review
Business Review Operational Excellence VEDANTA LIMITED – Investor Presentation, Feb 2018
Slide 13: Q3 FY2018 Results Highlights
Q3 FY2018 Results Highlights Operations: Robust production, and ramp-up on track EBITDA mix (Q3 FY2018) Zinc India: Refined zinc-lead production of 245kt, up 7% q-o-q 3% Zinc Zinc International: Strong production at BMM and Skorpion 5% 9% Aluminium: Continued ramp-up; production up 40% y-o-y w
Slide 14: Zinc India
Zinc India Q3 FY2018 Results MIC at 240kt; refined zinc-lead 245kt and refined silver at 132t CoP at $1,022/t; impacted by high input commodity prices Capacity expansion to 1.2mtpa MIC by FY2020 on track RAM U/G mine crossed ore production run-rate of 2mtpa; shaft to take total production capa
Slide 15: Zinc International
Zinc International Q3 FY2018 Results Significant progress at 250kt Gamsberg project Total production at 47kt On target for first production by mid CY2018, with ramp-up Skorpion at 26kt: highest in last 6 quarters due to full capacity in 9-12 months to higher blended grades and refinery Capex
Slide 16: Cairn Oil & Gas
Cairn Oil & Gas Q3 FY2018 Results Gross average production at 184,133 boepd Rajasthan production at 157,096 boepd Offshore production at 27,037 boepd Operating cost RJ waterflood operating cost at $4.3/boe RJ blended cost including EOR at $6.4/boe Production to ramp-up in Q4 as planned
Slide 17: Cairn O&G: Execution of growth projects commenced
Cairn O&G: Execution of growth projects commenced Enhanced Oil Recovery Gross production Net capex (kboepd) ($mn) Contract awarded for Bhagyam & Aishwariya EOR 300 300 275-300 220-250 250 Rigs to be mobilized during Q4FY18 185- 190 Tight Oil & Gas Projects Contract awarded for tight oil & gas
Slide 18: Aluminium
Aluminium Q3 FY2018 Results Aluminium Costs and Margins (in $/t, for Q3 FY2018) Record Aluminium production of 445kt, with current run rate Q2 18 2,012 78 63 2,153 (718) (709) (430) (84) $211/t (146) (259) (194) of 1.8mtpa and alumina production of 287kt 53 2,249 94 (782) Aluminum CoP at $1,945/
Slide 19: Power
Power TSPL (3 x 660 MW) Coal Outlook – Aluminium CPPs Record quarterly plant availability of 97%; 9 months Domestic coal supply situation availability at 68% and targeting availability of c. Low realisation of linkage coal in Q3 resulting in 75% for FY2018 higher coal cost ‘Take or Pay’ arra
Slide 20: Iron Ore
Iron Ore Q3 FY2018 Results Total sales of 1.8mt and production of 0.9mt Goa commenced production of higher quality ore through beneficiation and blending Karnataka achieved full allocation production in Q3, inventory of 0.5mt to be sold in Q4 Realizations: Beneficiation and blending increase
Slide 21: Copper India
Copper India Q3 FY2018 Results Volumes Production at 101kt Q3 Tc/Rc’s at 20.8 c/lb Net CoP of Usc 5.6/lb, higher q-o-q due to higher input commodity prices Outlook Maintain guidance for FY2018 production at 400kt Benchmark Tc/Rc for CY2018 at Usc 21.3/lb; c.11% lower Tuticorin I Copper Sme
Slide 22: Appendix
Appendix VEDANTA LIMITED – Investor Presentation, Feb 2018
Slide 23: Guidance
Guidance Segment FY18e Comments Zinc-Lead Integrated: 950kt • Revised guidance due to high input Zinc India Silver volume: +500 tonnes commodity prices CoP ($/t): $950-975/t • YTD CoP at 1,495/t; Q4 to be temporarily high due to early Zinc-Lead volume: c.160kt production from Skorpion Pit 112 and Zi
Slide 24: Optimising Capex to drive Cash Flow Generation
Optimising Capex to drive Cash Flow Generation Prioritised capital to high-return, low-risk projects to Growth Capex Profile and Free Cash Flow pre capex - $bn maximize cash flows 2.8 Oil & Gas Zinc H1 Capex spent $0.3bn, H2 FY 2017 expected at 2.4 Al & Power $0.8bn Copper Optionality Capex Re
Slide 25: Entity Wise Cash and Debt
Entity Wise Cash and Debt (in Rs. crore) 31 Dec 2017 30 Sept 2017 30 Jun 2017 Company Debt Cash & LI Net Debt Debt Cash & LI Net Debt Debt Cash & LI Net Debt Vedanta Limited 36,894 11,897 24,997 38,232 12,375 25,857 42,711 16,698 26,013 Standalone Cairn India Holdings 3,480 6,280 (2,800) 3,554 6,562
Slide 26: Strong Credit Profile and Balance Sheet
Strong Credit Profile and Balance Sheet Maturity Profile of Term Debt: Rs.34,467 Crore ($5.4 bn) (as of 31st Dec 2017) 9.4 Subsidiaries Standalone 7.4 3.7 6.5 6.2 Rs. ‘000 Crore 1.9 4.7 2.1 4.8 2.4 5.7 4.6 4.0 2.3 2.6 0.3 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 & Later Term debt of Rs.34,467 crore
Slide 27: Group Structure
Group Structure Vedanta Resources Plc Divisions of Vedanta Limited 79.4% 50.1% Sesa Iron Ore Sterlite Copper (Tuticorin) Konkola Copper Vedanta Ltd Power (600 MW Jharsuguda) Mines (KCM) Aluminium (Odisha aluminium and power assets) Cairn Oil & Gas* Subsidiaries of Vedanta Ltd 64.9% 51% 100
Slide 28: Segment Summary – Power
Segment Summary – Power Power Generation Capacity – c. 9GW IPP: 3.6GW CPP:5.1GW • 600MW Jharsuguda (of • 1,215MW Jharsuguda 2400MW plant) • 3*600MW Jharsuguda (of • 1,980MW TSPL 2400MW plant) • 2*300MW BALCO (of 41% • 540MW BALCO 1200MW plant) • 270MW BALCO 59% • 274MW HZL Wind Power • 2*300MW BALCO