MUMBAI : Vedanta Ltd posted a more than 40 percent drop in its quarterly net profit, as a global commodity slump dented earnings from its oil, gas and mining operations, but the resources group said it expected a “better” second half.
Adding to the commodity troubles that have also battered international rivals and shuttered mining projects globally, India’s largest privately owned miner has also been hit in recent quarters by mining bans in its key producing states.
The Supreme Court of India banned mining in the iron ore producing state of Goa in 2012 as part of a crackdown on illegal mining. It lifted the ban in April last year but companies had to wait to get environmental and other government clearances.
Vedanta began mining again in Goa in August, shipping ore from October, and that is likely to provide a boost to the second half of its financial year ending in March, said chief financial officer D.D. Jalan.
The group is also reining in operating and financing costs, Jalan told reporters after the company announced its results, adding that the second half would be “better”.
Vedanta’s consolidated net profit in the September quarter dropped to 9.74 billion rupees ($ 149.94 million) from 16.40 billion rupees a year ago, while net sales fell 16 percent to 163.49 billion rupees, a company statement said.
Vedanta, which has interests in oil and gas, iron ore, zinc, copper, power and aluminium, made a $ 2.3 billion offer in June to buy out minority shareholders in its cash-rich oil and gas unit, Cairn India Ltd (CAIL.NS).
Vedanta Chief Executive Tom Albanese has previously said the company’s offer was fair, dismissing reports that opposition from minority shareholders in Cairn India, including ex-parent Cairn Energy (CNE.L), could scupper the deal.
Vedanta said on Tuesday it now had regulatory approvals and hoped to put the offer to shareholders “as early as January”, but reiterated it was not planning an improved offer to woo reluctant investors.
Albanese said the group was “regularly engaging” with Cairn India’s minority shareholders but gave no further detail.