Vedanta Mixed Q3 Performance: Zinc Declines, Aluminium Rises; Analysts See Upside in Share Price

The mining giant Vedanta Limited released its production data for the third quarter of FY2024-25 on January 3, showcasing a blend of achievements and challenges across its business segments.

Key Production Highlights

  1. Zinc Production:
    Vedanta’s zinc output in India fell by 2% year-on-year to 265,000 tonnes in Q3, compared to 271,000 tonnes in the same period last year. The decline was attributed to lower mined metal production.
  2. Aluminium Production:
    On a brighter note, total aluminium production rose by 3% YoY, reaching 614,000 tonnes, up from 599,000 tonnes last year. The company’s aluminium production comes from two key segments—its Jharsuguda operations and its Bharat Aluminium Company (BALCO) subsidiary.
  3. Other Segments:
    • Alumina: Quarterly production increased by 7% YoY, with a nine-month YoY growth of 16%.
    • Zinc International: Mined metal output grew 12% YoY and 6% quarter-on-quarter (QoQ) to 46,000 tonnes.
    • Oil & Gas: Production declined 19% YoY and 5% QoQ to 99.4 kboepd, though the Jaya discovery under the OALP scheme contributed positively.
    • Ferrochrome: Achieved a nine-month record with a 35% YoY growth, hitting 72,000 tonnes.
    • Pig Iron: Output rose by 7% YoY and 14% QoQ due to furnace upgrades.

Market Reaction and Expert Analysis

Vedanta’s shares closed 1.8% higher at ₹457.90 on January 3, up from the previous close of ₹449.80. Stock market experts observed that Vedanta’s operational updates reflected a mix of resilience and challenges.

Anshul Jain, Head of Research at Lakshmishree Investment and Securities, remarked, “Vedanta Ltd showcased a mixed bag of performance in its Q3 FY25 operational update. While aluminium and zinc segments showed growth, oil and gas production saw a dip.”

Jain highlighted that zinc India achieved a record nine-month refined metal production of 783,000 tonnes, supported by improved grades and operational efficiencies.

Share Price Outlook

Mahesh M. Ojha, AVP of Research at Hensex Securities, provided a bullish outlook for Vedanta shares, stating, “Vedanta shares have built a strong support level at ₹438 and could reach ₹500 in the near term. Existing shareholders should hold the stock, keeping a stop loss below ₹438, while new investors may consider momentum buying for a short-term target of ₹500.”

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