Vedanta Limited · NSE:VEDL
Vedanta — Sesa Sterlite — Investor Presentation (December 2013)
26 slides from Vedanta's investor presentation, December 2013
Slide 1: A Global Natural Resource Major
A Global Natural Resource Major December 2013 Sesa Sterlite: A Global Natural Resource Major Nov 2013
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: H1 FY2014 Highlights
H1 FY2014 Highlights Corporate Merger of Sterlite Industries (India) Limited and Sesa Goa Limited, and consolidation of Vedanta Group completed; merged company named “Sesa Sterlite Limited” Financial Proforma Revenue of Rs. 32,387 crore Proforma EBITDA of Rs. 12,434 crore Proforma Attributab
Slide 4: Merger Completed
Merger Completed Simplified structure, cross- holdings eliminated Vedanta Listed on LSE Resources On track to achieve announced financial synergies Evaluating further operational synergies 79.4% 58.3% Konkola Copper Listed on Sesa Sterlite Mines NSE, BSE and NYSE Zinc-Lead- Oil & Gas Iron Ore
Slide 5: Tier-1 Asset Portfolio
Tier-1 Asset Portfolio H1 FY2014 Positioning R&R Life1 Production Capacity2 Oil & Gas 3 15 213kboepd 225+ kboepd India’s largest private-sector crude oil producer Zinc India 25+ 459kt 1.2mtpa Largest integrated zinc producer Zinc Intl. 20+ 196kt 400ktpa One of the largest undeveloped zinc deposits S
Slide 6: Strong production growth with consistent margins
Strong production growth with consistent margins Production Growth Consistent Margins driven by Diversification (in Copper Equivalent kt)1 (EBITDA by Segment in $mn) Zinc Iron ore Copper Zinc-Lead Silver Copper Aluminium Aluminium Power Oil & Gas 2,500 Power Iron Ore Oil & Gas EBITDA Margin %² 5,000
Slide 7: Efficient Cost Performance
Efficient Cost Performance Competitive Position on Cost Curve Quartiles Cost Efficient Tier-1 Assets driving High Margins (EBITDA margin) I II III IV Size of circle denotes EBITDA contribution 50% 45% Iron Ore Cost of Production 40% 35% Zinc India 30% 25% Zinc Oil & Gas Intl. 20% 15% 10% Aluminium 5
Slide 8: Well-Invested Assets Driving Positive Cash Flow
Well-Invested Assets Driving Positive Cash Flow Positive Free Cash Flow with production ramp-up Capex and Free Cash Flows ($bn) $0.5bn free cash flow (post growth capex) in H1 Free Cash Flow-H1³ Free Cash Flow-H2³ M&M Capex O&G Capex¹ Actively managing and reviewing our capex requirements 4.0
Slide 9: Opportunities and Challenges
Opportunities and Challenges Group Structure Merger Completed Buyout of GoI’s stake in HZL and BALCO Zinc India Mining Expansion: 1.2mtpa by FY2017 225+ kboepd by FY2014 Oil & Gas GoI issued policy on Integrated Block Development Re-commenced exploration in Rajasthan Karnataka: A
Slide 10: Key Strategic Priorities
Key Strategic Priorities Disciplined capital allocation: Low-risk and phased development Production growth across portfolio Sustained operational excellence and cost efficiencies with a focus on returns Active engagement with Governments Production ramp-up from well-invested assets driving s
Slide 11: Appendix
Appendix SESA STERLITE CORPORATE PRESENTATION – DECEMBER 2013
Slide 12: Well Positioned to Capitalise on India's Growth
Well Positioned to Capitalise on India’s Growth India Demand Outlook Strong Market Share in India FY2013 India Market Shares1,2 India Rank Sesa Sterlite Domestic Sales #1 66% 3 #1 97% Zinc Refined Copper Aluminum (kt) (kt) (kt) FY2013 Revenue Breakdown by Geography 85% #1 Africa Asia others 1% 1% Fa
Slide 13: Zinc
Zinc Zinc-India Zinc-India H1 FY2013 H1 FY2014 377 459 Improved operational efficiencies driving strong Mined Metal (kt) 310 368 volumes Refined Zinc – Integrated (kt) Refined Lead – Integrated (kt)1 53 60 Ramp-up in mined metal volumes 4.62 5.16 Saleable Silver – Integrated (moz) Operational
Slide 14: Rampura Agucha Mine – Isometric View
Rampura Agucha Mine – Isometric View Total ore production sustained at c.6mtpa from a combination of open cast and underground Commercial production from underground project in FY14 SESA STERLITE CORPORATE PRESENTATION – DECEMBER 2013 14
Slide 15: Oil & Gas
Oil & Gas Cairn India recognized as the fastest growing energy Oil & Gas H1 FY2013 H1 FY2014 company in the world (Platts Top 250 Global Energy Average Daily Gross Operated Company Rankings 2013) 207,105 212,873 Production (boepd) Operational efficiency and cost optimization Rajasthan 169,486 17
Slide 16: Oil & Gas: Rajasthan – A World Class Asset
Oil & Gas: Rajasthan – A World Class Asset Rajasthan Block - 26 discoveries to date Rajasthan Block Resource Potential – 7.3bn boe in place (in mmboe) On-shore Shakti Gross In Place Gross EUR Bhagyam Low-cost & Scalable 7,297 Shakti NE N-I North N-C-West-A Primarily Oil Exploration Upside N-
Slide 17: Oil & Gas – Regulatory Alignment and Outlook
Oil & Gas – Regulatory Alignment and Outlook India’s Oil Requirements & Cairn India’s Share of Cairn India Outlook Production Production (mmboe) On track for FY14 exit production target of over 225kboepd Net Import (mmboe) EOR and Infill wells to sustain production from existing Cairn India % of D
Slide 18: Iron Ore
Iron Ore India Iron Ore and Pig Iron H1 FY2013 H1 FY2014 Karnataka: Supreme Court cleared our mine to Sales (mt) 3.1 - resume operations Goa 3.0 - Awaiting final clearance to resume mining Karnataka 0.1 - Production 3.7 - Goa mining: Supreme Court hearings Average Net Sales Realizations ($/t)
Slide 19: Copper-India/Australia
Copper-India/Australia Copper-India/Australia H1 FY2013 H1 FY2014 Mined Metal – Australia (kt) 13 12 Smelter restarted in end June Copper Cathodes– India (kt) 175 98 Tuticorin Power Plant (mu) - 295 Ramped up to full capacity in Q2 Average Copper LME ($/t) 7,785 7,110 Copper Tc/Rc 11.8 14.6 St
Slide 20: Aluminium
Aluminium Strong operating performance: Jharsuguda-I and BALCO Aluminium and Alumina H1 FY2013 H1 FY2014 smelters operated above rated capacity Aluminium Production (kt) 382 395 BALCO 123 124 Sustained 2nd quartile costs, without captive bauxite Jharsuguda-I 259 271 Q2 costs at $1,651/t Alumin
Slide 21: Power
Power Jharsuguda 2,400 MW : H1 PLF of 43% Power H1 FY2013 H1 FY2014 Q2 PLF of 31%, primarily on account of lower Total Sales (mu) 5,364 5,087 demand due to good monsoon and weak balance Jharsuguda 2,400 MW 1 3,879 4,098 sheets of Discoms, despite power shortage BALCO 270 MW 684 231 H2 PLF expe
Slide 22: Strong Financial Profile
Strong Financial Profile Term Debt Maturity Profile (in $bn) Diversified Funding Sources (as of 30 September 2013) (as of 30 September 2013) Standalone Subsidiaries 2.1 Short Term Loans 14% Bonds-INR 1.6 22% 0.6 0.6 1.0 Convertible 0.9 Term Loans-USD 0.8 Bonds-USD 30% 0.4 11% 1.5 1.0 0.4 0.5 0.3 Ter
Slide 23: Entity Wise Debt and Cash
Entity Wise Debt and Cash Sesa Sterlite Net Debt Summary ($mn) 31 March 2013 (Proforma) 30 September 2013 Company Debt Cash & LI Net Debt Debt Cash & LI Net Debt Sesa Sterlite Standalone 6,830 494 6,336 6,602 587 6,015 Zinc India - 3,929 (3,929) - 3,627 (3,627) Zinc International - 197 (197) - 188 (
Slide 24: Project Capex
Project Capex Capex Spent H1 Spent up to Unspent Capex in Progress Completion Time (US$mn) 2013-14 Sept. 2013 as at 30.9.13 Cairn India 3,673 223 808 2,866 Total Capex Oil & Gas 3,673 223 808 2,866 Copper Sector 160 MW CPP at Tuticorin 80MW commissioned, next 80MW awaiting approval 161 6 157 4 Alumi
Slide 25: Project Capex
Project Capex Capex Spent H1 Spent up to Unspent Improvement and Enabling Capex Completion Time (US$mn) 2013-14 Sept. 2013 as at 30.9.13 Zinc India 240 24 184 56 ZI – Gamsberg 24 9 17 7 Western Cluster- Liberia 97 21 87 10 Total Improvement and Enabling Capex 361 54 289 72 Capex Spent H1 Spent up to
Slide 26: Group Structure
Group Structure Vedanta Resources Plc Divisions of Sesa Sterlite 79.4% 58.3% Iron Ore (Sesa Goa) Konkola Copper Smelting (Tuticorin) Copper Sesa Sterlite Mines (KCM) Power (2,400 MW Jharsuguda) Aluminium (VAL aluminium and power assets) Subsidiaries of Sesa Sterlite 58.8% 64.9% 51% 100% 100%
Sesa Sterlite — Investor Presentation (December 2013) on 6ix