Vedanta has delivered a sharply stronger set of quarterly numbers, but the metals-to-oil conglomerate is already sounding a note of caution about the year ahead — warning that the ongoing US-Israel-Iran war could add $50 to $100 per tonne to its aluminium cost of production in the first half of FY27, The Economic Times reported.
The alert is significant given that aluminium is Vedanta's single largest business, contributing roughly 40% of group revenue. The company has guided for the full-year aluminium cost of production at $1,650 to $1,700 per tonne in FY27, but the West Asia conflict has introduced a material upside risk to that range for at least the first two quarters.
Base metal prices spiked through the March quarter as supply disruptions linked to the war rippled through commodity markets — a dynamic that boosted near-term margins but simultaneously flagged rising input cost pressures for the period ahead.
1 April 2026
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A Strong Q4
Despite the cautionary guidance, the quarterly results were robust. Consolidated profit jumped 92.3% year on year, powered by strong base metal price realisations across the portfolio. Total revenue climbed 29.5 per cent to Rs 515.24 billion.
The aluminium segment led the charge with revenue up 17.4% year on year. Zinc and lead from the India operations grew 21.4 per cent. The standout performer was copper, where segment revenue surged 53.9 per cent — a reflection of both price tailwinds and improved operational performance.
Production ambitions remain intact despite the cost headwinds. Aluminium output is expected to rise to between 2.6 and 2.7 million tonnes in FY27, up from 2.46 million tonnes in FY26. Alumina production is projected at 4 to 4.1 million tonnes. The targets signal confidence in operational momentum even as the geopolitical environment introduces pricing uncertainty.
The Demerger Taking Shape
The results come shortly after Vedanta's board approved a significant structural transformation. Earlier this month, the company gave the go-ahead for a demerger into four separately listed entities, effective May 1, spinning off its steel and ferrous metals, oil and gas, aluminium and power businesses into standalone companies.
The base metals unit will remain with the parent entity. The restructuring is designed to unlock value by giving investors cleaner, more focused exposure to each business — though the aluminium demerger will now land in an environment where cost visibility for the first half of the year carries more uncertainty than usual.
