Vedanta Limited · NSE:VEDL
Vedanta — Q1 FY2021 Earnings Presentation
35 slides from Vedanta's earnings presentation, Oct 6, 2020
Slide 1: Q1 FY2021 October 2020
October 2020 Q1 FY2021 Exhibit 99.3
Slide 2: Cautionary Statement and Disclaimer
Cautionary Statement and Disclaimer The views expressed here may contain information derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness, reasonableness or reliability of this information. Any forwa
Slide 3: Contents
Contents Section Presenter Page Q1 FY21 Review & Business Update Sunil Duggal, CEO 4 Financial Update Arun Kumar, CFO 12 Appendix 19
Slide 4: Q1 FY2021 Review & Business Update
Q1 FY2021 Review & Business Update Sunil Duggal Chief Executive Officer Q1 FY2021
Slide 5: Key Highlights: Q1 FY2021
Key Highlights: Q1 FY2021 Operational Zinc India Metal production at 202kt with cost of production at $1,019/t Zinc International Gamsberg production at 25kt with cost of production $1,327/t O&G Rajasthan Operating cost at $6.9/boe vs $10.0/boe in Q4 FY20 Aluminum cost of production at $1,268/t, dow
Slide 6: Heading Towards Zero Harm, Zero Waste, Zero Discharge
Heading Towards – Zero Harm, Zero Waste, Zero Discharge Environment Update Water conservation ~7.5 million m3 of water savings over three years GHG Management 16.65% reduction in GHG emissions intensity from 2012 baseline; ~10 million TCO2e in avoided emissions Fly Ash Management >100% fly-ash utili
Slide 7: Zinc India: Strong Foundation Driving Growth
Zinc India: Strong Foundation Driving Growth Performance Update MIC Production 202kt, down 5% y-o-y and 19% q-o-q due to lower production in April and lower workforce availability on account of restrictions related to COVID-19 Metal Production 202kt, down 8% y-o-y and 9% q-o-q due to lower productio
Slide 8: Zinc International: Gamsberg Positioning for Long Term Value Creation
Zinc International: Gamsberg Positioning for Long Term Value Creation Performance Update Production at 38kt, down 33% q-o-q and 36% y-o-y due to Skorpion Zinc going under Care and Maintenance from April 20 & COVID-19 COP at $1,349/t, lower by 24% q-o-q and 22% y-o-y due to disciplined cost reduction
Slide 9: Oil & Gas: Focus on Delivery of Growth Projects
Oil & Gas: Focus on Delivery of Growth Projects Gross Production (kboepd) Lower production on account of delay in growth project execution due to nationwide lockdown 238 wells drilled and 86 hooked up Rajasthan Operating cost at $6.9/boe in Q1 FY21 vs $10.0/boe in Q4 FY20 Target to complete followin
Slide 10: Aluminium: Achieving Design Structure
Aluminium: Achieving Design Structure Structural Reduction in Cost Lanjigarh Production and Cost Performance Update Aluminium COP at $1,268/t, down 13% q-o-q and 28% y-o-y Lanjigarh production 476 kt, marginally down 1% q-o-q and up 7% y-o-y Lanjigarh COP at $218/t, down 16% q-o-q and 23% y-o-y Ingo
Slide 11: Other Assets: Iron ore and ESL Steel
Other Assets: Iron ore and ESL Steel Pig Iron Production (kt) Karnataka Sales (Mnt) ESL Steel Performance Update Production 267kt, down 17% y-o-y and 16% q-o-q Sales 305kt, up 12% y-o-y and flat q-o-q Margin at $44/t, down 58% y-o-y and 65% q-o-q due to COVID lockdowns and subdued macro economic fac
Slide 12: Financial Update
Financial Update Arun Kumar Chief Financial Officer Q1 FY2021
Slide 13: Financial snapshot
Financial snapshot EBITDA Net Debt# ND/EBITDA 4,008 cr ₹ 24,787 cr 1.2x Down 23% y-o-y Down 14% y-o-y Maintained at low level EBITDA Margin* Cash & Cash equivalent# ROCE^ 28% ₹ 33,781 cr c. 10% Robust Margin Liquidity Position Continuing double digit # Net debt and Cash & Cash equivalent as describe
Slide 14: EBITDA Bridge (Q1 FY2020 vs. Q1 FY2021)
Q1 FY20 LME / Brent /premiums Input Commodity Inflation Cost & Mktg Currency Adjusted EBITDA Regulatory & Profit Petroleum Q1 FY21 EBITDA Bridge (Q1 FY 2020 vs. Q1 FY 2021) Zinc, Lead & Silver (878) Brent (926) Aluminium (1,063) Steel (293) (In crore) Aluminium 354 ESL 175 IOB 50 HZL (246) Market &
Slide 15: EBITDA Bridge (Q4 FY2020 vs. Q1 FY2021)
Zinc, Lead & Silver (234) Brent (511) Aluminium (689) Steel (163) (In crore) Aluminium 59 Cairn 110 HZL (229) Market & Regulatory (581) crore Operational (443) crore LME / Brent /premiums Input Commodity Inflation Cost & Mktg Currency Adjusted EBITDA Regulatory & Profit Petroleum Q4 FY20 Q1 FY21 COV
Slide 16: Net Debt for Q1 FY2021
Net Debt for Q1 FY 2021 (In ₹ crore) (Incl Buyer’s credit)1 Capex Dividend Net Debt2 30th Jun’20 Net Debt 1st Apr’20 Inventory , Debtors & Others (521) Creditors / Customers advance (2,578) Translation & Others 1 Including Short term Working Capital Instruments converted into long term loans/ repaid
Slide 17: Balance Sheet
Balance Sheet Net Debt# / EBITDA Liquidity: Cash and Cash equivalent# at 33,781 crore Undrawn line of credit ₹ 9,469 crore Net Interest: Interest Income – Returns ~5.8%. Interest Expense – Maintained ~8.2% Average term debt maturity maintained above 3 years Credit Rating: CRISIL maintained at AA wit
Slide 18: Key Investment Highlights
Key Investment Highlights Large Low Cost, Long Life and Diversified Asset Base with an Attractive Commodity Mix 1 Ideally Positioned to Capitalise on Favourable Geographic Presence Operational Excellence and Technology Driving Efficiency and Sustainability 4 Well-Invested Assets Driving Cash Flow Gr
Slide 19: Appendix
vedanta Pa =a Appendix dl ee
Slide 20: Income Statement
Income Statement Depreciation & Amortization Lower compared to previous quarters primarily due to impairment of assets in Oil & Gas business in Q4 FY2020, and lower ore production in Zinc India & International business. Finance Cost Lower y-o-y due to repayment of debt and lower average interest cos
Slide 21: Entity Wise Cash and Debt
Entity Wise Cash and Debt Company Jun 30, 2020 Mar 31, 2020 Jun 30, 2019 Debt Cash & Cash Eq4 Net Debt4 Debt Cash & Cash Eq Net Debt Debt Cash & Cash Eq Net Debt Vedanta Limited Standalone 33,247 4,070 29,177 38,937 5,029 33,908 40,171 4,147 36,024 Cairn India Holdings Limited1 3,700 7,726 (4,026) 3
Slide 22: Debt Breakdown & Funding Sources
Debt Breakdown & Funding Sources Debt breakdown as of 30 Jun 2020 (in $bn) ( in 000’ Cr) Term debt 6.3 47.2 Working capital 0.5 3.6 Short term borrowing 1.0 7.8 Total consolidated debt 7.8 58.6 Cash and Cash Equivalent# 4.5 33.8 Net Debt# 3.3 24.8 Debt breakup ($7.8bn) - INR Debt 87% - USD / Foreign
Slide 23: Segment Summary – Zinc India
Segment Summary – Zinc India Production (in ’000 tonnes, or as stated) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Mined metal content 202 213 (5)% 249 917 Integrated metal 202 219 (8)% 221 870 Refined Zinc – Integrated 157 172 (8)% 172 688 Refined Lead – Integrated1 45 48 (7)% 49 18
Slide 24: Segment Summary – Zinc International
Segment Summary – Zinc International Production (in’000 tonnes, or as stated) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Refined Zinc – Skorpion 1 18 (96)% 15 67 Mined metal content- BMM 12 19 (36)% 12 66 Mined metal content- Gamsberg 25 23 11% 30 108 Total 38 60 (36)% 57 240 Financ
Slide 25: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas OIL AND GAS (boepd) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Average Daily Gross Operated Production (boepd) 158,779 180,059 (12)% 160,838 172,971 Rajasthan 127,937 149,153 (14)% 132,315 144,260 Ravva 22,037 13,491 63% 17,562 14,232 Cambay 8,805 17,415
Slide 26: Oil and Gas production by block
OIL AND GAS (boepd) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Average Daily Production Gross operated 158,779 180,059 (12)% 160,838 172,971 Oil 142,772 165,983 (14)% 138,205 154,677 Gas (Mmscfd) 96 84 14% 136 110 Non operated- Working interest 492 162 204% 608 483 Working Interest
Slide 27: Segment Summary – Aluminium
Segment Summary – Aluminium Particulars (in’000 tonnes, or as stated) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Alumina – Lanjigarh 476 446 7% 479 1,811 Total Aluminum Production 469 471 (0)% 474 1,904 Jharsuguda-I 132 134 (1)% 133 543 Jharsuguda-II 1 199 199 (0)% 196 800 245kt Kor
Slide 28: Aluminium profitability
Aluminium profitability Q4 ‘20 $/t Q1 ‘21 40 64 295 360 (69) 1,690 62 72 1,823 (571) (560) (320) (34) 340 (145) (249) (55) # 1,451 1,268 # Conversion & Others cost excluding gain on RPO liability reversal in Q1 FY21 is $75/t. Gain on RPO liability reversal amounting to $101/t in Q1 FY21.
Slide 29: Segment Summary – Power
Segment Summary – Power Particulars (in million units) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Total Power Sales 1,843 3,523 (50)% 2,107 11,162 Jharsuguda 600 MW 685 267 157% 482 776 BALCO 300 MW 403 425 (5)% 460 1,726 HZL Wind Power 112 134 (16)% 71 437 TSPL 643 2,697 (76)% 1,09
Slide 30: Segment Summary – Iron Ore and Steel
Segment Summary – Iron Ore Particulars (in million dry metric tonnes, or as stated) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY2020 FY 2020 Sales 1.02 1.22 (17)% 2.27 6.63 Goa 0.6 0.0 0% 0.6 0.9 Karnataka 0.4 1.2 (64)% 1.6 5.8 Production of Saleable Ore 0.95 1.09 (13)% 0.77 4.36 Goa - - - 0.0 0.
Slide 31: Segment Summary – Copper India
Segment Summary – Copper India Production (in ’000 tonnes, or as stated) Q1 Q4 Full year FY 2021 FY 2020 % change YoY FY 2020 FY 2020 Copper - Cathodes 17 16 4% 26 77 Financials (In crore, except as stated) Revenue 1,377 1,777 (22)% 2,256 9,053 EBITDA (63) (66) 4% (68) (300) Copper LME Price ($/MT)
Slide 32: Sales Summary
Sales Summary Sales volume Q1 FY2021 Q1 FY 2020 Q4 FY2020 FY2020 Zinc-India Sales Refined Zinc (kt) 163 167 173 680 Refined Lead (kt) 45 47 48 180 Total Zinc-Lead (kt) 208 215 220 860 Silver (tonnes) 146 155 144 586 Zinc-International Sales Zinc Refined (kt) 1 17 20 67 Zinc Concentrate (MIC) 28 29 3
Slide 33: Sales Summary
Sales Summary Sales volume Q1 FY 2021 Q1 FY 2020 Q4 FY 2020 FY 2020 Iron-Ore Sales Goa (mn DMT) 0.6 - 0.6 0.9 Karnataka (mn DMT) 0.4 1.2 1.6 5.8 Total (mn DMT) 1.0 1.2 2.3 6.6 Pig Iron (kt) 108 172 159 666 Copper-India Sales Copper Cathodes (kt) 1.1 0 0.7 2.5 Copper Rods (kt) 17 22 30 98 Total Steel
Slide 34: Currency and Commodity Sensitivities
Currency and Commodity Sensitivities Commodity prices – Impact of a 10% increase in Commodity Prices Commodity Q1 FY‘21 Average price EBITDA ($mn) Oil ($/bbl) 30 12 Zinc ($/t) 1,961 30 Aluminium ($/t) 1,497 60 Lead ($/t) 1,673 7 Silver ($/oz) 16.4 8 Foreign Currency - Impact of 1 Rs depreciation in
Slide 35: Group – Present Debt Structure
Group – Present Debt Structure 50.1% 64.9% Subsidiaries of Vedanta Ltd Sesa Iron Ore Sterlite Copper Power (600 MW Jharsuguda) Aluminium (Odisha aluminium and power assets) Cairn Oil & Gas* Divisions of Vedanta Limited Unlisted entities Listed entities 95.5% 100% 51% Note: Shareholding as on June 30