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Vedanta Poised for 16% EBITDA Surge by FY28
25 Nov
Summary
- EBITDA expected to grow 16% annually through FY28.
- New capacity in aluminium, zinc, and power to drive growth.
- Demerger planned to unlock value for investors.
Vedanta is on track for a substantial 16% compound annual growth in EBITDA through FY28, driven by significant capacity expansions in its aluminium, zinc, and power businesses. Recently commissioned facilities are set to boost contributions from Q3 of the current fiscal year, with major projects slated for completion over the next two years. This growth is further supported by declining aluminium production costs and stable commodity prices.
The company's strategic focus on demerger, delivery, and deleveraging is expected to yield positive results, with a favourable outcome from the NCLT anticipated by December 2025, paving the way for demerger by Q4FY26. This structural change aims to unlock value by allowing investors to invest in specific commodity businesses. Consolidated net debt is projected to decrease to Rs 61,000 crore by the end of FY27.
Key expansions include new power plants, an alumina refinery, and an aluminium smelter, with further growth planned for Zinc International. Vedanta's power business has also secured new power purchase agreements, enhancing earnings visibility. Analysts anticipate strong EBITDA growth across all core segments, with aluminium production costs expected to fall significantly by FY28.
