Vedanta Limited Unveiled: Soaring Profits, Strategic Moves & a Bullish FY25 Outlook

Vedanta Limited, one of India’s leading diversified natural resources companies, has entered FY25 with strong momentum. Backed by rising commodity prices, robust operational efficiency, and a strategic push into renewable energy and global expansion, the company has reported impressive financial results for 9MFY25. With its proposed demerger, debt restructuring initiatives, and record EBITDA performance, Vedanta is not only improving its internal fundamentals but also positioning itself for long-term shareholder value creation.

📊 1. Financial Performance: Stellar Results in FY25 So Far

Vedanta Limited has reported robust financial performance for the first nine months of FY25, driven by a mix of operational excellence, commodity price strength, and internal efficiencies.

🔹 Revenue Performance

• 3QFY25: ₹38,526 Cr
  → Up 10% YoY from ₹34,968 Cr
  → Up 4% QoQ from ₹37,171 Cr

• 9MFY25: ₹1,10,936 Cr
  → Up 9% YoY from ₹1,02,048 Cr

🔹 Profitability (PAT before Exceptional Items)

• 3QFY25: ₹4,876 Cr
  → Massive 70% YoY growth over ₹2,868 Cr
  → 9% QoQ growth over ₹4,467 Cr

• 9MFY25: ₹14,438 Cr
  → 151% YoY growth over ₹5,753 Cr

🔹 EBITDA Performance

• 3QFY25: ₹11,284 Cr
  → Up 30% YoY from ₹8,677 Cr
  → Up 9% QoQ from ₹10,364 Cr

• 9MFY25: ₹31,924 Cr
  → Up 40% YoY from ₹22,849 Cr

📌 Historical Comparison (Context)

✅ Takeaway: FY25 is turning out to be one of the strongest years in Vedanta’s history, reversing past volatility and establishing a firm earnings base.

🏗️ 2. Operational Performance & Order Pipeline Equivalent

Vedanta doesn’t follow an “order book” model like EPC players but tracks production volumes and project pipelines as performance indicators.

🔸 Aluminium Segment

• 3QFY25: 613 kt → 2% YoY growth

• 9MFY25: 1,819 kt → 3% YoY increase

• Ongoing ramp-ups in Jharsuguda and BALCO are adding meaningful capacity.

🔸 Zinc Segment

• Zinc India Refined Output: 783 kt (9MFY25) → 3% YoY growth

• Zinc International: 127 kt mined metal

• Continued expansion via Hindustan Zinc’s smelting efficiencies

🔸 Iron Ore

• Saleable Production (9MFY25): 4.1 million tonnes → 8% YoY growth

🔸 Alumina

• 3QFY25: 505 kt production

• Captive sourcing from Lanjigarh refinery helps margin protection

✅ Takeaway: Vedanta’s production trends show steady growth, improved throughput, and strong supply-side execution across verticals.

🌍 3. Business Expansion & Geographic Reach

📌 Renewable Energy Foray

• Secured 1,920 MW of Power Delivery Agreements (PDAs) by 3QFY25

• Consumed 1.75 billion units → reducing carbon footprint

• RE usage aligns with Vedanta’s ESG goals

📌 Global Expansion

Vedanta is now active or exploring resource assets across:

• India (core market)

• South Africa & Namibia (Zinc & base metals)

• New Markets:
  → UAE, Saudi Arabia, Korea, Taiwan, Japan
  → Early-stage partnerships, mining interests, RE collaborations

🔄 4. Demerger Plan: Strategic Transformation

🧱 Proposed Structure

Vedanta is restructuring into multiple independent listed entities:

• Aluminium

• Zinc

• Oil & Gas

• Power

• Iron Ore

• Base Metals

🔎 Timeline & Status

• Shareholder/Creditor Vote: Scheduled for Feb 18, 2025

• Execution Target: Mid-2025, post SEBI/NCLT approval

🧠 Strategic Rationale

• Unlock vertical-specific valuation multiples

• Improve capital access per segment (e.g., ESG funds for RE verticals)

• Attract sector-focused investors

• Operational independence → better capital allocation & decision-making

✅ Takeaway: Demerger is a value-unlocking catalyst likely to improve EPS, investor appeal, and reduce group complexity.

💰 5. Debt Management & Refinancing

📌 Key Metrics (as of Dec 31, 2024)

🔁 VRL Bond Restructuring (2024–25)

• $3.1 billion in offshore bonds restructured

• Coupon Rate Cut: 250 bps

• Maturity Extended: Up to 8 years

• HoldCo Debt Now: $4.8 billion → lowest in 10 years

💸 Cash Flow Highlights

• Free Cash Flow Pre-Capex (3QFY25): ₹6,766 Cr

• Funding capex internally while managing repayments

✅ Takeaway: Vedanta’s deleveraging strategy is working, making it a safer long-term investment with improving solvency and no short-term EPS risk.

🌐 6. Total Addressable Market (TAM) & Opportunities

🧮 TAM Snapshot

🔎 Growth Enablers

• Infrastructure-led metal demand in India

• Global shift toward green commodities

• LME Price Tailwinds:

  • Aluminium: $2,575/ton

  • Zinc: $3,050/ton

• Oil price stable at ~$74.7/bbl (manageable margin volatility)

⚠️ Risks:

• Commodity cycle downturns

• INR depreciation (₹85.59/USD) affects cost base

• Legal delays (Tuticorin Copper Plant remains shut since 2018)

✅ Takeaway: Vedanta is positioned across high-growth markets, with pricing power and margin leverage in several segments.

⚖️ 7. Regulatory & Market Dynamics

• No SEBI or ASM listing issues

• Tuticorin copper plant still closed since 2018 → Legal reactivation underway

• Promoter Holding (~70%) stable; no major pledging reported in FY25

🏦 Market Sentiment Factors

• FII outflows due to macro risks

• Retail + DII demand strong post demerger news

• INR depreciation affects imported inputs and dollar-denominated debt

✅ Takeaway: No critical regulatory barriers exist beyond Tuticorin. Investor confidence remains supported by promoter stability and consistent disclosures.

📈 8. Technical & Chart View (Mar 26, 2025)

📊 Forecast Summary

• Short-Term (3–6 Months): ₹420–₹460

  • Driven by Q4 performance + demerger events

• Mid-Term (1–2 Years): ₹500–₹520

  • Margin growth + asset unlock

• Long-Term (3–5 Years): ₹600+

  • Full demerger effect + global scale-out

✅ Takeaway: Consolidation near ₹400 indicates a potential breakout setup, with long-term bullish formation supported by strong fundamentals.

📉 9. Valuation Snapshot

📌 Despite earnings momentum, Vedanta trades at a discount to sector averages, giving value investors a strong entry point.

❓ Top 10 FAQs About Vedanta Limited (2025)

1. Is Vedanta Limited a good stock to buy in 2025?
   ✅ Yes. With strong earnings growth, margin expansion, and a strategic demerger in the pipeline, Vedanta offers high upside potential for value and growth investors.

2. What’s driving Vedanta’s profit growth in FY25?
   🚀 Key drivers include higher commodity prices (aluminium, zinc), cost optimizations, production ramp-ups, and improved operational efficiencies.

3. What is the status and impact of Vedanta’s demerger?
   🔄 The demerger into six verticals is expected by mid-2025. It aims to unlock value, improve capital allocation, and make each business independently investable.

4. How is Vedanta managing its debt in FY25?
   💸 The company has restructured $3.1B in offshore bonds, extended maturity to 8 years, cut coupon rates, and reduced HoldCo debt to $4.8B—the lowest in a decade.

5. What are Vedanta’s growth plans beyond FY25?
   🌍 Plans include capacity expansion in aluminium and zinc, renewable energy integration (1,920 MW PDAs), and geographic expansion in UAE, KSA, Taiwan, Japan.

6. What is Vedanta’s current valuation status?
   📉 At a P/E of ~10–12x (vs. sector avg ~15x), Vedanta is fair to undervalued, with strong earnings visibility and demerger-driven re-rating potential.

7. What risks does Vedanta face in 2025?
   ⚠ Key risks include commodity price volatility, INR depreciation, potential regulatory delays (e.g., Tuticorin copper plant), and global macro uncertainty.

8. What is happening with the Tuticorin copper plant?
   🏭 The plant remains closed since 2018 due to regulatory action. Legal proceedings for reopening are ongoing, but timelines remain uncertain.

9. How is Vedanta positioned in renewable energy?
   🔋 It has signed PDAs for 1,920 MW of RE power, already utilizing 1.75 billion units, significantly reducing carbon footprint and aligning with global ESG goals.

10. What is the technical outlook for Vedanta stock in 2025?
    📈 The stock is consolidating around ₹400, with support at ₹350 and resistance at ₹460. A breakout is possible with Q4 results and demerger clarity, with a long-term target of ₹600+.

✅ Conclusion

Vedanta Limited is emerging as a fundamentally strong, growth-driven, and strategically focused company in 2025. With its 9MFY25 PAT up 151% YoY and EBITDA margins holding at 34%, it demonstrates powerful earnings momentum. The proposed demerger into specialized verticals, growing renewable energy integration, and improved debt metrics through successful bond restructuring all point to a well-managed, forward-looking enterprise. Despite macro risks such as commodity price volatility and regulatory hurdles (like the Tuticorin plant issue), Vedanta remains undervalued relative to peers—making it a compelling investment case for medium to long-term investors.