Vedanta Limited · NSE:VEDL
Vedanta — Q4 FY2021 Earnings Presentation
53 slides from Vedanta's earnings presentation, May 13, 2021
Slide 1: Q4 & FY2021 Earnings Presentation
Q4 & FY2021 Earnings Presentation VEDANTA LIMITED INVESTOR PRESENTATION 13 May 2021 Sensitivity: Internal (C3)
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: Contents
Contents Section Presenter Page Q4 & FY21 Review & Business Update Sunil Duggal, CEO 4 Financial Update Ajay Goel, Deputy CFO 23 Appendix 31 VEDANTA LIMITED – Q4 & FY2021 INVESTOR PRESENTATION 3 Sensitivity: Internal (C3)
Slide 4: Q4 & FY2021 Review and Business Update
Q4 & FY2021 Review and Business Update Sunil Duggal Group CEO & Chief Safety Officer Sensitivity: Internal (C3)
Slide 5: Ideally Positioned with Attractive Commodity Mix
Ideally Positioned with Attractive Commodity Mix Vedanta has unparalleled exposure to India, the world’s fastest growing major economy with excellent diversified exposure 2021 2030 CAGR World CAGR India demand Global demand GDP CAGR 2020–20302 CAGR 2020–20302 (real terms) $2.8trn $4.8trn 6.3% 3.1% G
Slide 6: COVID-19 Response: Supporting Communities, Employees & Partners
COVID-19 Response: Supporting Communities, Employees & Partners Vedanta Cares 1,000 bed initiative in 10 locations across India will add Helping Community 10 ventilator-equipped beds, 90 oxygen-support beds in each location. ▪ Aluminium, Cairn, HZL have added almost 1000 additional Global Standards
Slide 7: Key Highlights: FY 2021
Key Highlights: FY 2021 Production Cost of Production R&R Records Lower Advancing At Zinc India, Aluminium & Zinc Across all the businesses Enhancing life and R&R base International Reliability Technology & Digitalization COVID-19 Improved On Track Highest safety standards No major operational disru
Slide 8: Delivering Strong Operational Performance in Challenging times
Delivering Strong Operational Performance in Challenging times Aluminium Zinc India Gamsberg 1,047 1,690 954 1,347 1,445 1,288 Strong 1,904 1,969 870 930 108 145 operational recovery FY20 FY21 FY20 FY21 FY20 FY21 Aluminium (kt) COP ($/t) Metal (kt) COP ($/t) MIC Production (kt) COP $/t Record Produc
Slide 9: Heading Towards – Zero Harm, Zero Waste, Zero Discharge
Heading Towards – Zero Harm, Zero Waste, Zero Discharge Safety Program Update ▪ Comprehensive focus on HSE at CEO and Group ExCo Level; Consequence Management program set up Focus on Learning and ▪ New Vedanta-wide Fatality Investigation Procedure Improvement ▪ Working groups focusing on critical ri
Slide 10: ESG is core to everything we do
ESG is core to everything we do Achievements in FY 2021 On track to Achieve Vedanta’s Vision ▪ Water Savings of 2.03 mm3 ▪ Zero discharge across all our sites ▪ 1.86 million GJ Energy Savings ▪ 20% reduction in GHG emission intensity by 2025 from a 2012 baseline ▪ Reduced GHG emissions by 13.0 milli
Slide 11: Climate Change Roadmap
Climate Change Roadmap Building Blocks to achieve Net-Zero Carbon Emissions Avoid Increase Renewable Energy Deployment Minimize Align with Science Based Targets Offset Bridge gap by sequestration & carbon credits use Disclose Annual TCFD Climate Change Report FY2021 Milestones ▪ 13.6 million tons of
Slide 12: Aluminium: Success Continues; Growing Value in Dynamic World
Aluminium: Success Continues; Growing Value in Dynamic World Aluminium Production & COP Performance Update 1,904 1,969 Quarter Performance: 1,451 1,387 1,433 ▪ Highest ever Aluminium production 531 kt*, up 12% y-o-y and 1,690 1,347 7% q-o-q 474 497 531 ▪ Aluminium COP $ 1,433/t, down 1% y-o-y and up
Slide 13: Alumina: Expanding Lanjigarh on path to Vertical Integration
Alumina: Expanding Lanjigarh on path to Vertical Integration Grow Into Among One Of The Largest Single-location Alumina Refineries In The World 5 Capacity (Mtpa) 2 Expected Project Completion by Q1 FY2023 Present Target Strong Foundation for Expansion Finest Technical Mix of global & local bauxite T
Slide 14: Zinc India: A Year Full of the Achievements
Zinc India: A Year Full of the Achievements Sustained production post-transition to Performance Update fully UG mining company 19% UG ▪ Highest ever Ore production of 15.5 million MT CAGR ▪ Highest ever Mined Metal Delivered of 972kt, up 6% 972 Mined Metal in kt 223 936 917 426 primarily on account
Slide 15: Zinc India: Strategy in Practice for Executing Growth Imperatives
Zinc India: Strategy in Practice for Executing Growth Imperatives Strengthen Cost Leadership Portfolio of Mines with Long Transition to a Circular Life Economy ▪ Digitalization ▪ Upgrading R&R through world ▪ Focus on technology and ▪ Autonomous vehicles class technologies innovation to ▪ Implemente
Slide 16: Zinc International: Gamsberg Positioning for Long Term Value Creation
Zinc International: Gamsberg Positioning for Long Term Value Creation Continued Performance Ramp Up Performance Update Quarter Performance: 1501,484 1,445 1500 1,350 ▪ Highest milled tonnes achieved at 961kt in Q4 and best 1300 displayed mill throughput at 522tph 100 1,246 1,288 1,240 1100 ▪ Highest
Slide 17: Zinc International: Gamsberg Ramp up Plan
Zinc International: Gamsberg Ramp up Plan 145kt 190-210kt FY21 Four Key Priorities Going Forward FY22e Mining Focused Concentrator Focused 1 2 3 4 Equipment Run-hours Additional Resource Increase Mill Recovery Ramp up Improvement to gear up Mining Throughput Increase Expedite on-boarding Improve rec
Slide 18: Oil & Gas: Stable Operations, Focus on Delivery of Growth Projects
Oil & Gas: Stable Operations, Focus on Delivery of Growth Projects Operations Growth Projects OALP ▪ Gas Terminal: Ramp-up by ▪ Drilling: 15 well exploration ▪ Production: Increased to 165 ~15kboepd underway. Gas offtake kboepd in Q4 FY21 vs 160 kboepd drilling program commenced impacted by Covid in
Slide 19: Oil & Gas: Digitalisation & Partnering to Drive Efficiency & Recovery
Oil & Gas: Digitalisation & Partnering to Drive Efficiency & Recovery Digitalization to improve Technology to Solution based asset reliability accelerate recovery Partner Approach • Well interventions • Polymer & Water • Global EOI for solution & • Process Controls Management KPI driven Partnering •
Slide 20: Iron ore: Resilient Results in Extraordinary Times
Iron ore: Resilient Results in Extraordinary Times Capitalised opportunity of increased Global Value Added Business prices by increasing sales in Goa 2.1 ▪ Benefitted by domestic steel prices and International coal prices Mnt 0.8 0.9 ▪ Margin improvement through efficiency 0.6 0.6 enhancement projec
Slide 21: ESL Steel: Continuing Improvement Journey
ESL Steel: Continuing Improvement Journey Performance Update Capacity Expansion Plan in Pipeline Quarter Performance: ▪ Robust margin of $131/t, highest in FY21 ▪ Doubling Hot Metal Capacity from 1.5 to 3 ▪ Saleable Production of 319kt, flat y-o-y and down 6% MTPA production q-o-q ▪ Sales of 323kt,
Slide 22: FACOR: Complete Turnaround Performance
FACOR: Complete Turnaround Performance Delivering Stronger Growth and Margins FY22 Growth Plan ▪ Ore Production in H2 increased by 105% vs H1 ▪ Targeting to increase Furnace ▪ Reduced ore procurement from third party to ZERO production by 10% by optimizing operation & better process control ▪ Fe chr
Slide 23: Finance Update
Q4 & FY2021 Finance Update Ajay Goel | Deputy Chief Financial Officer Sensitivity: Internal (C3)
Slide 24: Financial snapshot Q4
Financial snapshot Q4 EBITDA Attributable PAT (before Gross Debt ND exceptional items) ₹ 9,107 cr ₹ 7,013cr ₹ 57,028 cr ₹ 24,414 cr 88% up Y-o-Y, highest ever Strong financial performance ~ 9% lower Q-o-Q ~32% lower Q-o-Q EBITDA Margin * ROCE # Cash & Cash Equivalents ND/EBITDA 38% c.19% ₹ 32,614cr
Slide 25: EBITDA Bridge (Q4 FY 2021 vs. Q3 FY 2021)
EBITDA Bridge (Q4 FY 2021 vs. Q3 FY 2021) (In ₹ crore) Aluminium 850 Zinc, Lead & Silver 300 Cairn 369 ESL 196 IOB 178 Cairn (140) Power (121) 1,893 295 638 318 384 … 166 44 9,107 … 9,171 7,695 Al (287) Cairn (59) HZL 33 Al 202 IOB 95 Market & Regulatory HZL 343 ₹ 1,476 crore Cairn 20 Q3 FY 21 LME/
Slide 26: EBITDA Bridge (Q4 FY2021 vs. Q4 FY2020)
EBITDA Bridge (Q4 FY2021 vs. Q4 FY2020) (In ₹ crore) Aluminum 1,737 Oil & Gas 299 Oil & Gas (142) Zinc, Lead & Silver 1,519 FACOR 53 IOB 311 ESL 278 Power (116) 922 564 4,143 186 62 8,951 202 9,107 89 Al (490) ESL (96) HZL 30 4,844 TSPL (94) IOB 189 HZL 507 Market & Regulatory GB 147 ₹ 4,108 crore Q
Slide 27: Net Debt for FY 2021
Net Debt for FY 2021 (In ₹ crore) FCF post capex ₹ 13,821 Cr 24,414 Inventory ,Debtors 718 and others Creditors / Customers (3,279) advance 23,667 WC Inter co. Net Debt Net Debt CF from Capex Dividend FACOR Translation Movements loan to 31st 1st Apr’20# Operations Paid Acquisition & Others* (Incl Bu
Slide 28: Balance Sheet and Debt Breakdown
Balance Sheet and Debt Breakdown Net Debt / EBITDA – maintained at low level Debt Breakdown (as of 31st Mar 2021) 1.1 1.0 Debt breakdown as of 0.9 0.9 (in $bn) (₹ in 000’ Cr) 31st Mar 2021 0.4 Term debt 7.3 53.3 Working capital 0.2 1.4 FY'17 FY'18 FY'19 FY'20 FY'21 Short term borrowing 0.3 2.3 ▪ Liq
Slide 29: Capex and Returns Profile
Capex and Returns Profile Growth CAPEX Profile, $bn Oil & Gas Zinc Al & Power Copper Other Optionality Full year Capex guidance 0.7 1.0 1.2 1.5 1.2 0.7 1.1 1.1 0.1 0.2 0.8 0.8 0.1 0.7 0.1 0.5 0.1 0.6 0.1 0.3 0.2 0.2 0.3 0.1 0.5 0.3 0.2 0.3 0.1 0.2 0.1 0.1 0.5 0.5 0.2 0.4 FY2016 FY2017 FY2018 FY2019
Slide 30: Strategy to Enhance Long Term Value
Strategy to Enhance Long Term Value Continue Focus on World Class ESG Performance Augment Our Reserves & Resources Base Operational Excellence and Cost Leadership Optimise Capital Allocation & Maintain Strong Balance Sheet Delivering on Growth Opportunities VEDANTA LIMITED – Q4 & FY2021 INVESTOR PRE
Slide 31: Appendix
Q4 & FY2021 Appendix Sensitivity: Internal (C3)
Slide 32: FY 2022 Guidance
FY 2022 Guidance Segment Production and COP Mined Metal and Finished Metal: 1,025 – 1,050 Kt Zinc India Silver: c. 720 tonnes COP: < $1,000/t excluding royalty BMM: ~70 – 80 Kt Zinc International Gamsberg: 190-210 kt COP: $1,100/t - $1,200/t Average Gross Volume: 175-185 kboepd; Oil & Gas Opex: c. $
Slide 33: Income Statement
Income Statement Depreciation & Amortization Q4 Q4 In ₹ Crore FY’21 FY’20 FY’21 FY’20 ▪ Lower majorly on account of Oil & Gas assets impairment in Q4 FY’20. Revenue from operations 86,863 83,545 27,874 19,513 Other operating income 1,158 902 332 242 Finance Cost EBITDA 27,341 21,060 9,107 4,844 ▪ Hi
Slide 34: Project Capex
Project Capex (In $ mn) Spent up to Approved Spent in Unspent as at Capex in Progress Status Capex3 31 Mar’204 FY20214 31 Mar 20215 Cairn India1 – Mangala Infill, Liquid handling, Bhagyam & Aishwariya EOR, Tight Oil & Gas, OALP 2,522 1,144 181 1,197 etc Aluminium Sector Line 3: Fully capitalised Lin
Slide 35: Entity Wise Cash and Debt
Entity Wise Cash and Debt (In ₹ crore) Mar 31, 2021 Mar 31, 2020 Company Cash & Cash Cash & Cash Debt Net Debt Debt Net Debt5 Eq Eq5 Vedanta Limited Standalone 32,166 5,851 26,315 38,937 4,954 33,983 Cairn India Holdings Limited1&4 2,810 1,402 1,408 3,696 7,776 (4,081) Zinc India 7,178 22,308 (15,13
Slide 36: Funding Sources and Term Debt Maturities
Funding Sources and Term Debt Maturities Diversified Funding Sources for Term Debt of $7.3bn Term Debt Maturities : ₹ 53,326 Cr ($7.3bn) (as at 31 Mar’21) (as of 31st Mar 2021) 1% 40% Term Loans-INR 21.2 10% 28 % Bonds-INR 14.7 18% 7.7 Term Loans-USD/Foreign ₹ ‘000 Crore Currency 4.7 9.7 14% 31% Bon
Slide 37: EBITDA Bridge (FY 2021 vs. FY 2020)
EBITDA Bridge (FY 2021 vs. FY 2020) (In ₹ crore) Cairn (1,630) Al 510 Cu 125 ASI 90 FACOR 69 Zinc, lead & Silver 1,243 Power 63 Aluminium 923 ESL & IOB 538 Cairn (1632) 1,243 786 907 27,341 2,091 108 25,901 … 1,072 1,646 … 21,060 Al 980 HZL 142 Cairn 123 Al 108 HZL 1,170 IOB 251 Market & Regulatory
Slide 38: Segment Summary – Zinc India
Segment Summary – Zinc India Q4 Q3 Full year Production (in ’000 tonnes, or as stated) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Mined metal content 288 249 15% 244 972 917 6% Integrated metal 256 221 16% 235 930 870 7% Refined Zinc – Integrated 195 172 14% 182 715 688 4% Refi
Slide 39: Segment Summary – Zinc International
Segment Summary – Zinc International Q4 Q3 Full year Production (in’000 tonnes, or as stated) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Refined Zinc – Skorpion 0 15 (100)% 0 1 67 (99)% Mined metal content- BMM 14 12 16% 16 58 66 (12)% Mined metal content- Gamsberg 41 30 38% 43
Slide 40: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas Q4 Q3 Full year OIL AND GAS (boepd) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Average Daily Gross Operated 165,000 160,838 3% 159,621 162,104 172,971 (6%) Production (boepd) Rajasthan 138,057 132,315 4% 132,174 132,599 144,260 (8%) Ravva 16,258 17,5
Slide 41: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas Q4 Q3 Full year OIL AND GAS (boepd) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Average Daily Production Gross operated 165,000 160,838 3% 159,621 162,104 172,971 (6)% Oil 139,818 138,205 1% 136,687 140,353 154,677 (9)% Gas (Mmscfd) 151 136 11% 138 13
Slide 42: Segment Summary – Aluminium
Segment Summary – Aluminium Particulars (in’000 tonnes, or as Q4 Q3 Full year stated) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Alumina – Lanjigarh 496 479 4% 407 1,841 1,811 2% Total Aluminum Production 531 474 12% 497 1,969 1,904 3% Jharsuguda-I 137 133 3% 132 533 543 (2)% J
Slide 43: Aluminium profitability
Aluminium profitability $/t Q3 ‘FY21 1,916 43 68 2,027 (603) (484) (300) (76) 565 (136) (323) 105 1,387 Q4 ‘FY21 1,433 2,096 59 71 2,226 616 494 323 101 131 692 298 263 245 LME Ingot Value Other EBITDA Realisation Alumina Power Conversion Dep Int PBT Premium addition Hot & Others Metal VEDANTA LIMIT
Slide 44: Segment Summary – Power
Segment Summary – Power Q4 Q3 Full year Particulars (in million units) % change % change FY 2021 FY 2020 FY2021 FY 2021 FY 2020 YoY YoY Total Power Sales 3,352 2,107 59% 2,066 11,261 11,162 1% Jharsuguda 558 482 16% 784 2,835 776 - BALCO 380 460 (17)% 395 1,596 1,726 (7)% HZL Wind Power 65 71 (8)% 6
Slide 45: Segment Summary – Iron Ore and Steel
Segment Summary – Iron Ore Particulars (in million dry metric tonnes, or Q4 Q3 Full year as stated) FY 2021 FY 2020 % change YoY FY2021 FY 2021 FY 2020 % change YoY Sales 2.2 2.3 (4)% 1.8 6.5 6.6 (2)% Goa 0.8 0.6 - 0.6 2.1 0.9 - Karnataka 1.4 1.6 (13)% 1.2 4.4 5.8 (24)% Production of Saleable Ore 1.
Slide 46: Segment Summary – Copper India
Segment Summary – Copper India Q4 Q3 Full year Production (in ’000 tonnes, or as stated) % change % change FY 2021 FY 2020 FY 2021 FY 2021 FY 2020 YoY YoY Copper - Cathodes 35 26 38% 25 101 77 31% Financials (In ₹ crore, except as stated) Revenue 3,945 2,256 75% 2,664 10,890 9,053 20% EBITDA (71) (6
Slide 47: Sales Summary
Sales Summary Sales volume Q4 FY2021 Q4 FY2020 FY2021 FY 2020 Q3 FY2021 Zinc-India Sales Refined Zinc (kt) 198 173 724 680 182 Refined Lead (kt) 62 48 216 180 53 Total Zinc-Lead (kt) 260 220 940 860 235 Silver (tonnes) 203 144 735 586 183 Zinc-International Sales Zinc Refined (kt) 0 20 1 67 0 Zinc C
Slide 48: Sales Summary
Sales Summary Q4 FY Q4 FY Q3 Sales volume Q4 Q4 Q3 Sales volume FY2021 FY2020 FY 2021 FY2020 2021 2020 FY2021 Power Sales (mu) FY 2021 FY 2020 FY2021 Iron-Ore Sales Jharsuguda 558 482 2,835 776 784 Goa (Mn DMT) 0.8 0.6 2.1 0.9 0.6 TSPL 2,349 1,094 6,479 8,223 820 Karnataka (Mn DMT) 1.4 1.6 4.4 5.8 1
Slide 49: Currency and Commodity Sensitivities
Currency and Commodity Sensitivities Foreign Currency - Impact of ₹ 1 depreciation in FX Rate Currency Increase in EBITDA INR/USD ~ ₹ 600 crore / year Commodity prices – Impact of a 10% increase in Commodity Prices FY 2021 Full Year Impact on Commodity Average price EBITDA ($mn) Oil ($/bbl) 45 68 Zi
Slide 50: Augment our Reserves and Resources Base
Augment our Reserves and Resources Base Focused exploration to expand our reserves and resources base for support our future growth through • Targeted and disciplined exploration • Offsetting depletion and bringing on stream more discoveries • Team aim to discover mineral and oil deposits in a safe
Slide 51: Awards & Recognition in Q4 FY21
Awards & Recognition in Q4 FY21 Name of Awards Category/ Recognition Recipient (Business Unit) From the Indian Chamber of Commerce in the Large Enterprise 14th ICC Environment Excellence Award (2020)” ZSD – Hindustan Zinc category at the 14th Environment Partnership E-Summit Leading practices in tec
Slide 52: Group – Present Debt Structure
Group – Present Debt Structure ($ bn) Vedanta Resources (Consolidated) Volcan FY21 FY21 EBITDA 3.8 EBITDA - Net Debt 10.5 Net Debt 0.2 Vedanta Resources (Standalone) FY21 % EBITDA 0.1 2% Divisions of Vedanta Limited Net Debt 7.2 68% 55.1% ⚫ Sesa Iron Ore ⚫ Sterlite Copper Vedanta Ltd (Consolidated)
Slide 53: Results Conference Call Details
Results Conference Call Details Results conference call is scheduled at 6:30 PM (IST) on May 13, 2021. The dial-in numbers for the call are given below: Event Telephone Number Earnings conference call on May 13, 2021 India – 6:30 PM (IST) India: +91 7045671221 Toll free: 1800 120 1221 Universal acce