- Vedanta Iron and Steel's Q2 FY27 Ebitda fell to Rs 83 crore from Rs 515 crore in Q1 FY27
- Revenue dropped 23.9% QoQ to Rs 2,788 crore due to weaker steel prices and higher costs
- Net loss widened to Rs 324 crore from a Rs 121 crore profit in the prior quarter
Vedanta Iron and Steel Ltd reported a sharp sequential decline in profitability in Q2 FY27, as weaker steel realisations, higher input costs and seasonal disruptions weighed on its operating performance.
The Ebitda fell to Rs 83 crore from Rs 515 crore in the preceding quarter, while the margin contracted to 3% from 12%. The company's revenue from operations declined 23.9% quarter-on-quarter to Rs 2,788 crore from Rs 3,612 crore. Net loss widened to Rs 324 crore from a profit after tax of Rs 121 crore in Q1 FY27, according to its investor presentation.
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However, the year-on-year comparison showed an improvement in operating earnings. Ebitda rose 56% from Rs 54 crore in Q2 FY26, while the margin expanded by 112 basis points. The net loss also narrowed from Rs 477 crore in the year-ago quarter.
Higher Costs, Seasonal Disruptions Weigh on Earnings
Vedanta Iron attributed the sequential deterioration to weaker steel realisations, higher coking coal and fuel costs, and seasonal effects that pushed up operating expenses. Planned shutdowns at its Bokaro and Goa steel plants also affected production during the quarter.
Lower iron ore dispatches from Karnataka further pressured performance. The company said the shutdowns were completed to improve asset reliability ahead of the second half of FY27.
Steel production, including pig iron, stood at 532,000 tonnes in Q2 FY27, up 4% year-on-year but down from 582,000 tonnes in the previous quarter. Iron ore production declined 13% year-on-year to 1.5 million dry metric tonnes.
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First-Half Earnings Show Improvement
Despite the weak quarter-on-quarter performance, the company recorded stronger operating results for the first half of FY27. Revenue increased 8% year-on-year to Rs 6,450 crore, while Ebitda climbed 54% to Rs 598 crore. The Ebitda margin improved by 275 basis points to 9%.
The half-year net loss narrowed to Rs 203 crore from Rs 622 crore a year earlier. Vedanta Iron also received an AA/Stable credit rating from CRISIL. Its net debt-to-EBITDA ratio stood at 1.3 times, excluding intercompany loans, according to the company's presentation.
The company has secured 21 MW of open-access solar power for its ESL Bokaro operations, with the potential to reduce annual emissions by around 50,000 tonnes of carbon dioxide.
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