Vedanta Iron & Steel Ltd (VISL) delivered exceptional performance in Q1 FY27, with net profit surging to ₹111 crore compared to a net loss of ₹167 crore in the corresponding quarter last year, as reported by CNBC TV18. This represents a remarkable turnaround from the company's previous quarter performance and demonstrates strong operational recovery. The company achieved revenue growth of 18% year-on-year to ₹3,662 crore, significantly outperforming expectations and marking a substantial improvement in business performance. The improved performance was supported by steel sales volumes increasing 9% and iron ore volumes rising 2% during the quarter, along with better operating efficiencies across manufacturing facilities.
The company achieved significant operational milestones during the quarter, with pig iron production reaching a record 291 kilotonnes and iron ore production increasing 4% to 2.6 million dry metric tonnes, according to CNBC TV18. EBITDA jumped 55% to ₹508 crore, reflecting improved operational efficiencies and better cost management. CEO Pankaj Kumar Sharma highlighted the company's resilient performance despite dynamic market conditions, citing higher iron ore production, record quarterly pig iron output, and operational efficiencies across steel businesses as key drivers of strong margin improvement. The company's EBITDA margin improved to 13.9% from 10.6% year-on-year, demonstrating enhanced profitability across operations.
VISL demonstrated significant financial discipline during the quarter, with finance costs declining sharply by 55%, aided by lower debt levels and inter-company settlement adjustments following the Vedanta demerger, as reported by CNBC TV18. Net debt stood at ₹2,733 crore at the end of the quarter, reflecting improved financial management. The company has approved a capital expenditure programme of ₹3,697 crore, of which ₹2,565 crore has already been spent. The remaining ₹1,132 crore is expected to support future capacity expansion, positioning the company for continued growth in the steel sector.
Despite the year-on-year decline, the company demonstrated sequential improvement by reversing a loss of ₹1,939 crore in the preceding three months to report a net profit of ₹111 crore for the June quarter, as reported by CNBC TV18. This sequential recovery shows the company's ability to maintain profitability on a quarter-to-quarter basis, even as it faces year-on-year challenges. The stock currently trades at around 7x annualised EV/EBITDA, broadly in line with peers, reflecting market confidence in the company's operational turnaround and growth prospects.
While VISL delivered strong results, other Vedanta Group companies showed mixed performance in Q1 FY27. Vedanta Oil and Gas Ltd (VOGL) reported a net profit of ₹945 crore compared to losses in previous quarters, aided by favourable commodity prices and strong operational discipline, though revenue from operations fell 3.1% sequentially to ₹2,507 crore. However, Vedanta Power Ltd recorded a net loss of ₹423 crore despite 31% revenue growth to ₹2,595 crore, highlighting the challenges in the power sector. The mixed results across the group's demerged businesses reflect varying market conditions and operational dynamics across different sectors.
