Slide 1: Channelling growth opportunities
Channelling Vedanta Limited growth opportunities VEDANTA LIMITED-OIL&GAS|ZINC&SILVER|ALUMINIUM|POWER|IRONORE|COPPER I N V E S T O R P R E S E N T A T IO N May, 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: Contents
Contents Section Presenter Page FY18 Review Kuldip Kaura, CEO 4 Financial Update Arun Kumar, CFO 10 Kuldip Kaura, CEO Growth Projects 16 Sudhir Mathur, CEO - Cairn Oil & Gas Appendix 26 VEDANTA LIMITED – FY2018 INVESTOR PRESENTATION 3
Slide 4: FY18 Review
FY18 Review Kuldip Kaura Chief Executive Officer VEDANTA LIMITED OIL&GAS|ZINC&SILVER|ALUMINIUM| POWER|IRONORE|COPPER
Slide 5: Safety and Sustainability
Safety and Sustainability • Safety LTIFR – (per million man-hours worked) • 7 fatalities in FY18 0.89 • Workshops to validate & manage safety-related Critical Risks • 874,296 hours in safety training 0.52 0.49 • British Safety Council “5-Star Rating” for O & G - Rajasthan & 0.43 0.41 0.40 Midstream
Slide 6: Key Messages - FY 2018
Key Messages - FY 2018 Solid Operational Operational Excellence Strong Financials Delivering Growth Performance • EBITDA of Rs. 25,470 cr • Zinc India on track for • Record annual • Vendor partnership (36% margin^); PAT of Rs. ramp up to 1.2mt production of refined programme zinc-lead and silver at
Slide 7: Business highlights
Business highlights Zinc India Zinc International O&G Aluminium FY18 Avg: 186 kboepd Aluminium: 1.7mt Refined Zn-Pb: 960kt BMM: 72kt Production FY18 Exit: 200 kboepd FY18 Exit: c.2.0mt Silver: 558 tonnes Skorpion: 84kt (Gross) Alumina: 1.2mt Costs CoP ex. royalty: $976/t CoP: $1,603/t RJ blended: $6
Slide 8: Business highlights (cont’d)
Business highlights (cont’d) Power Iron Ore & Steel Copper India Power sales: 11,041MU Goa: 4.9mt Production Cathodes: 403 kt TSPL availability: 74% Karnataka: 2.2mt TSPL margin: Re 1/unit CoP IOG: $27.6/t Costs CoP: 5.7c/lb CoP IOK: $7.8/t EBITDA Rs. 1,669 cr Rs. 460 cr Rs. 1,308 cr (Margin %) (30%
Slide 9: Delivering on our Strategic Priorities
Delivering on our Strategic Priorities Optimise Capital Augment our Operational Allocation & Maintain Reserves & Excellence Strong Balance Sheet Resources base Well developed exploration programs Volume growth and Preserve our License Delivering on Growth 19.5mt gross additions asset optimisat
Slide 10: Financial Update
Financial Update Arun Kumar Chief Financial Officer VEDANTA LIMITED OIL&GAS|ZINC&SILVER|ALUMINIUM| POWER|IRONORE|COPPER
Slide 11: Financial snapshot
Financial snapshot EBITDA FCF post capex ND/EBITDA Gross Debt Rs. 25,470 cr Rs. 7,880 cr 0.9x Rs. 58,159 cr Up 19% y-o-y Strong FCF Continues below 1.0x Lower 19% y-o-y EBITDA Margin* Attributable PAT# ROCE^ Dividend 36% Rs. 8,025 cr 17.5% Rs. 7,881 cr Industry leading margin Up 10% y-o-y Up 250 bp
Slide 12: EBITDA Bridge (FY2018 vs. FY2017)
EBITDA Bridge (FY2018 vs. FY2017) (In Rs. crore) Zinc & Lead 3,624 Aluminum 3,735 Zinc India 1,488 Brent 961 Aluminum 1,136 Metal Premiums 161 ZI 177 Iron ore (472) TSPL 76 Brent Discount (54) Cairn (43) Iron-ore (431) Power (231) 7,955 4,073 Others (11) 1,718 2,161 403 2 25,470 113 23,714 21,437 Op
Slide 13: Net Debt for FY2018
Net Debt for FY2018 (In Rs. crore) FCF Post Capex Rs. 7,880 crore 1 11,275 21,958 3,010 18,269 19,426 7,160 7,434 294 10,683 8,099 4,112 Net Debt Special Preference Adjusted Net CF from WC Capex Translation & Net Debt Dividends Reported Net 1st Apr 17 Dividend in Shares Debt Operations Movements Oth
Slide 14: Strong Credit Profile and Balance Sheet
Strong Credit Profile and Balance Sheet Maturity Profile of Term Debt: Rs. 33,197 Crore ($5.1 bn) (as of 31st Mar 2018) 9.2 Subsidiaries Standalone 6.4 3.5 6.0 5.7 Rs. ‘000 Crore 1.8 2.0 4.3 3.5 2.0 5.7 4.6 4.0 1.6 2.3 1.1 2.2 0.5 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 & Later Term debt of Rs. 33
Slide 15: Capex at Attractive Returns
Capex at Attractive Returns Growth Capex Profile and Free Cash Flow pre capex - $bn • Prioritised high-return, low-risk projects to Oil & Gas maximize cash flows Zinc Al & Power Copper • Strong cash flows to self fund Optionality Capex 15.0% Free Cash Flow (pre-capex) ROCE 4.5% 2.8 • FY 2018 Capex s
Slide 16: Growth Projects
Growth Projects Kuldip Kaura Chief Executive Officer Sudhir Mathur CEO –Cairn Oil & Gas VEDANTA LIMITED OIL&GAS|ZINC&SILVER|ALUMINIUM| POWER|IRONORE|COPPER
Slide 17: India’s Growth Drives Resources Demand
India’s Growth Drives Resources Demand 6.0 trillion 3,979 (2030) 40% (2030) Improving regulatory (2030) environment: Transparent 2,083 (2018) 34% (2018) 2.8 trillion (2018) auctioning and private Per capita income (real) Urbanisation ownership GDP (real) India’s demand potential 7.5kg 1.5 b 0.9 kg 1
Slide 18: High-return growth projects with further optionality
High-return growth projects with further optionality Current Near-term growth Medium-term growth Current update Zinc-lead production: Zinc-lead production: Zinc-lead production: • Phase – I with target of 1.35mt pa towards Zinc India c.1mt 1.2mt 1.5mt a ramp-up to 1.5MT pa production Silver: 558t Si
Slide 19: $2 billion Capex for Incremental 200 kboepd Peak Production
$2 billion Capex for Incremental 200 kboepd Peak Production Million barrels of oil equivalent 2P Reserves: 2009 465 74 539 Production: 2009-18 478 126 604 Reserves & Resources: 2018 97 35 176 375 580 1,263 Commercialised 683 RJ PSC 2020 (Base) Ravva, CB, etc. PSC Extension Growth Projects Yet to be
Slide 20: Growth Projects: Doubling the number of wells in Rajasthan
Growth Projects: Doubling the number of wells in Rajasthan Gross capex of $2 bn for Growth Projects to monetize 375 mmboe, $1.3 bn contracts in place, $0.5 bn contracts to be awarded by Q1FY19 Increasing wells in Rajasthan from 500+ to 900+ will add incremental peak production of 200 kboepd 9
Slide 21: Exploration: Creating Sustainable Stakeholder Value
Exploration: Creating Sustainable Stakeholder Value Gross Capex of over $ 100m for Exploration & Appraisal in FY19 Onshore Exploration o Rajasthan Exploration (300-600 mmboe of resources) 7-18 E&A wells drilling to commence in Aug 2018 o Rajasthan Tight Oil Appraisal (190 mmboe of resources) App
Slide 22: Aluminium: Ramp-up on track, Focus on Costs
Aluminium: Ramp-up on track, Focus on Costs Cost of production ($/t) 1,887 • Ramp-up alumina production (FY19: 1.5-1.6mt) vs FY18: 1.2mt 1,725-1,775* 1,463 409 1,500 Alumina • Step change in local bauxite sourcing 301 697 • Diversify imported alumina sourcing 580 • Improve linkage realization and in
Slide 23: Zinc India: Vision of 1.5mtpa MIC capacity
Zinc India: Vision of 1.5mtpa MIC capacity Roadmap to Phase – I of 1.35mtpa Zinc – Lead – Silver FY18 FY20 FY21 Rampura Agucha UG 2.1 4.5 5.0 1.5 mt 1,500 t Sindesar Khurd 4.6 6.0 6.5 Zawar 2.2 4.5 5.7 Rajpura Dariba 0.9 1.5 2.0 1.2 mt + 800 t Kayad 1.2 1.2 1.2 Total ore capacity 10.9 17.7 20.4 mtpa
Slide 24: Zinc International: Gamsberg Expansion
Zinc International: Gamsberg Expansion • Reserve and Resource of 215mt (15mt Zinc) 450-500 • Potential to ramp up to 600ktpa • Phase 1 : On track for first production in middle 2018 Production (kt) • Ramp up to 250kt by FY2020 250 • Potential Phase 2 : Mine design for open pit completed 100 • Additi
Slide 25: Key Investment Highlights
Key Investment Highlights 1 2 Large & diversified asset base with an Ideally positioned to capitalise on attractive commodity mix India’s growth potential 3 4 Operational Excellence and Well-invested assets Technology Driving Efficiency and driving cash flow growth Sustainability 5 6 Strong Financia
Slide 26: Appendix
Appendix VEDANTA LIMITED OIL&GAS|ZINC&SILVER|ALUMINIUM| POWER|IRONORE|COPPER
Slide 27: FY 2019 Guidance
FY 2019 Guidance Segment FY19 Production FY19 CoP Zinc India Zinc-Lead Integrated > FY18 production ; Silver: 650 - 700 tonnes $950-975/t excluding royalty ZI COP (excl Gamsberg) : $1850 - Skorpion and BMM: 150kt Zinc International 1950 Gamsberg: 100kt Gamsberg: $1,000 - $1,150/t Oil & Gas Gross Vol
Slide 28: Income Statement
Income Statement Depreciation & Amortization Q4 Q4 In Rs. Crore FY’18 FY’17 FY’18 FY’17 • Higher in Q4 primarily on account of higher capitalisation at Aluminium business offset by lower charge at Oil & Revenue 92,923 76,171 27,630 23,691 Gas due to change in reserve estimates and change in EBITDA 2
Slide 29: Non Cash Impairment Charge in Q4
Non Cash Impairment Charge in Q4 Net impairment reversal of Rs. 4,436 cr in Q4 • Oil & Gas business: • Reversal of previously recorded impairment charge of Rs. 7,016 cr (Rs. 4,257 cr net of taxes) in FY 2018. • Non cash impairment reversal taken, following the progress on the key growth projects whi
Slide 30: Project Capex
Project Capex Capex5 Spent up to Spent in Unspent as at Capex in Progress Status ($mn) Mar 2017 6 FY2018 31 Mar’18 7 Cairn India – Mangala Infill, Liquid handling, 1386 56 127 1203 Bhagyam & Aishwariya EOR, Tight Oil & Gas etc Aluminium Sector BALCO – Korba-II 325ktpa Smelter and Smelter: fully oper
Slide 31: EBITDA Bridge (Q4 FY2018 vs Q3 FY2018)
EBITDA Bridge (Q4 FY2018 vs Q3 FY2018) (In Rs. crore) Aluminium 174 Zinc India 277 Brent 136 Aluminium 61 Iron ore 2 Iron ore 35 Brent Discount 28 Cairn (14) TSPL (21) Metal Premiums 85 Power (35) Zinc & Lead (94) Others 17 7,929 258 420 274 172 6,931 320 331 6,781 79 Operational Market & Regulatory
Slide 32: Entity Wise Cash and Debt
Entity Wise Cash and Debt 31 Mar 2018 31 Mar 2017 Company Debt Cash & LI Net Debt Debt Cash & LI Net Debt Vedanta Limited Standalone 40,713 7,132 33,581 43,233 2,316 40,917 Cairn India Holdings Limited1 2,773 5,653 (2,880) - 27,646 (27,646) Zinc India - 22,189 (22,189) 7,908 32,166 (24,258) Zinc Int
Slide 33: Debt Breakdown & Funding Sources
Debt Breakdown & Funding Sources Diversified Funding Sources for Term Debt of $5.1bn Debt Breakdown (as of 31st Mar 2018) (as of 31 Mar 2018) Debt breakdown as of 31 (in $bn) (Rs. in 000’ Cr) March 2018 13% Term debt 5.1 33.2 Term Loans-INR Working capital 0.6 4.1 Bonds-INR Short term borrowing 2.7
Slide 34: Segment Summary – Zinc India
Segment Summary – Zinc India Q4 Q3 Full year Production (in ’000 tonnes, or as stated) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Mined metal content 255 312 (18)% 240 947 907 4% Refined Zinc – Total 206 215 (4)% 200 791 672 18% Refined Zinc – Integrated 206 215 (4)% 200 791 67
Slide 35: Segment Summary – Zinc International
Segment Summary – Zinc International Q4 Q3 Full year Production (in’000 tonnes, or as stated) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Refined Zinc – Skorpion 22 21 3% 26 84 85 (1)% Mined metal content- BMM 13 20 (33)% 21 72 70 3% Total 35 41 (14)% 47 157 156 - Financials (In
Slide 36: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas Q4 Q3 Full year OIL AND GAS (boepd) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Average Daily Total Gross Operated Production 200,032 194,343 3% 193,647 195,150 199,574 (2)% (boepd)* Average Daily Gross Operated Production 190,172 184,585 3% 184,133 1
Slide 37: Segment Summary – Oil & Gas
Segment Summary – Oil & Gas Q4 Q3 Full year OIL AND GAS (boepd) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Average Daily Production Gross operated 190,172 184,585 3% 184,133 185,587 189,926 (2)% Oil 181,612 180,914 - 175,911 177,678 184,734 (4)% Gas (Mmscfd) 51.4 22.0 - 49.3 47
Slide 38: Segment Summary – Aluminium
Segment Summary – Aluminium Q4 Q3 Full year Particulars (in’000 tonnes, or as stated) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Alumina – Lanjigarh 351 313 12% 287 1,209 1,208 - Total Aluminum Production 477 353 35% 445 1,675 1,213 38% Jharsuguda-I 132 132 - 116 440 525 (16)%
Slide 39: Segment Summary – Power
Segment Summary – Power Q4 Q3 Full year Particulars (in million units) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Total Power Sales 3,109 3,462 (10)% 3,146 11,041 12,916 (15)% Jharsuguda 600 MW 404 952 (58)% 111 1,172 3,328 (65)% BALCO 600 MW 388 793 (51)% 466 1,536 2,609 (41)%
Slide 40: Segment Summary – Power (contd.)
Segment Summary – Power (contd.) Power Generation Capacity – c. 9GW IPP: 3.6GW CPP:5.1GW • 600MW Jharsuguda (of • 1,215MW Jharsuguda 2400MW plant) • 3*600MW Jharsuguda (of 2400MW • 1,980MW TSPL plant) 41% • 2*300MW BALCO (of 1200MW • 540MW BALCO plant) • 270MW BALCO 59% • 274MW HZL Wind Power • 2*30
Slide 41: Segment Summary – Iron Ore
Segment Summary – Iron Ore Particulars (in million dry metric tonnes, or Q4 Q3 Full year as stated) FY 2018 FY 2017 % change YoY FY2018 FY 2018 FY 2017 % change YoY Sales 2.7 3.0 (8)% 1.8 7.6 10.2 (26)% Goa 2.4 2.3 5% 1.0 5.4 7.4 (26)% Karnataka 0.3 0.7 (51)% 0.8 2.2 2.7 (21)% Production of Saleable
Slide 42: Segment Summary – Copper India
Segment Summary – Copper India Q4 Q3 Full year Production (in ’000 tonnes, or as stated) FY 2018 FY 2017 % change YoY FY 2018 FY 2018 FY 2017 % change YoY Copper - Cathodes 106 103 3% 101 403 402 - Tuticorin power sales (million units) 2 64 (97)% 3 39 200 (80)% Financials (In Rs. crore, except as st
Slide 43: Sales Summary
Sales Summary Sales volume Q4 FY2018 FY 2018 Q4 FY2017 FY 2017 Q3 FY2018 Zinc-India Sales Refined Zinc (kt) 210 793 217 696 200 Refined Lead (kt) 50 169 47 138 45 Total Zinc (Refined+Conc) kt 210 793 243 723 200 Total Lead (Refined+Conc) kt 50 169 47 138 45 Total Zinc-Lead (kt) 259 961 290 861 245 S
Slide 44: Sales Summary
Sales Summary Q4 FY Q4 FY Sales volume Sales volume FY2018 FY2017 Q3 FY2018 Q4 FY2018 FY2018 Q4 FY2017 FY2017 Q3 FY2018 2018 2017 Power Sales (mu) Iron-Ore Sales Jharsuguda 600 MW 404 1,172 952 3,328 111 Goa (mn DMT) 2.4 5.4 2.3 7.4 1.0 TSPL 2,258 7,915 1,596 6,339 2,512 Karnataka (mn DMT) 0.3 2.2 0
Slide 45: Group Structure
Group Structure Vedanta Resources Plc Divisions of Vedanta Limited 79.4% 50.1% Sesa Iron Ore Sterlite Copper (Tuticorin) Konkola Power (600 MW Jharsuguda) Copper Vedanta Ltd Mines (KCM) Aluminium (Odisha aluminium and power assets) Cairn Oil & Gas* Subsidiaries of Vedanta Ltd 64.9% 51% 100
Slide 46: Results Conference Call Details
Results Conference Call Details Results conference call is scheduled at 6:30 PM (IST) on May 3, 2018. The dial-in numbers for the call are given below: Event Telephone Number India: +91 7045671221 Earnings conference call on May 3, 2018 India – 6:30 PM (IST) Toll free: 1800 120 1221 Universal access