Billionaire Anil Agarwal’s Indian mining company Vedanta reported an 18% drop in quarterly profit on weak prices of key metals such as zinc and aluminum and higher finance costs.
It posted a profit of 20.1-billion rupees ($242-million) in October-December, down from 24.64-billion rupees a year earlier, the company said in a statement Thursday. Revenue rose 3.8% to 349.7-billion rupees.
Total costs climbed 2.8% with finance costs jumping 54% during the period. Net income at unit Hindustan Zinc, which makes up most of Vedanta’s profits, fell 5.6% during the quarter, it said last week.
The drop in profits come at a time when investors expect the Mumbai-listed firm to focus on its own expansion projects rather than helping its holding company reduce debt. Some of that pressure eased after parent Vedanta Resources extended the due dates for some of its dollar bonds.
“With a balanced capital structure through successful liabilities management at Holdco, Vedanta has a stronger balance sheet and will remain committed towards deleveraging and value creation,” Ajay Goel, chief financial officer, said in the statement.
The company is also in the middle of planning an overhaul of its businesses to unlock value. It has filed a proposal with stock exchanges in the last quarter and upon receiving approval, the plan will be submitted to the company law tribunal, Vedanta said.
Shares of Vedanta closed 0.4% higher in Mumbai on Thursday. Analysts have eight buy recommendations on the company, three holds and three sells, according to data compiled by Bloomberg.
