Check Before You Invest : Vedanta Ltd

Q: Which industry/sub-sector does Vedanta Ltd belong to?

Vedanta Ltd belongs to the Metals & Mining sector, operating specifically within the Metal - Non Ferrous segment.

Q: Is Vedanta Ltd a good quality company?

Vedanta Ltd is a good quality company, based on a consistently good multi-year financial track record. This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q: Is Vedanta Ltd undervalued or overvalued?

Vedanta Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 7.41, Historic Median: 10.21. Price to Book, Current: 2.6, Historic Median: 3.91. Price to Sales, Current: 1.68, Historic Median: 1.15. EV to EBITDA, Current: 6.15, Historic Median: 5.47

Q: Is Vedanta Ltd a good buy now?

Vedanta Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of Vedanta Ltd?

Vedanta Ltd revenue growth is 6.4% for FY-2025, which is below its 5-year CAGR of 12.62%, indicating slower growth.

Q: Gross Profit margin of Vedanta Ltd?

Vedanta Ltd Gross profit margin which is the profit after deduction of direct costs, is 23.6% for FY-2025, which is in line with its 5-year median of 23.6%, indicating stable margins.

Q: Operating Profit Margin of Vedanta Ltd?

Vedanta Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 27.76% for FY-2025, which is in line with its 5-year median of 27.76% indicating stable margins.

Q: Net Profit Margin of Vedanta Ltd?

Vedanta Ltd Net Profit Margin is 13.42% for FY-2025, is in line with its 5-year median of 13.42%, indicating stable margins. Profitability Metrics. Gross Profit Margin (%), Current: 23.6, Historic Median: 23.6. Operating Profit Margin (%), Current: 27.76, Historic Median: 27.76. Net Profit Margin (%), Current: 13.42, Historic Median: 13.42

Q: Return on Asset of Vedanta Ltd?

Vedanta Ltd Return on Asset is 10.58%, which is above its 5-year historical median of 8.43%, indicating improved asset utilization efficiency.

Q: Return on capital employed (ROCE) of Vedanta Ltd?

Vedanta Ltd Return on capital employed is 29.58% for FY-2025, which is above its 5-year historical median of 25.2%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Check Before You Invest : Vedanta Ltd

Snapshot

Q.1 Which industry/sub-sector does Vedanta Ltd belong to?

Vedanta Ltd belongs to the Metals & Mining sector, operating specifically within the Metal - Non Ferrous segment.

Q.2 Is Vedanta Ltd a good quality company?

Vedanta Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Vedanta Ltd undervalued or overvalued?

Vedanta Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	7.41	10.21
Price to Book	2.6	3.91
Price to Sales	1.68	1.15
EV to EBITDA	6.15	5.47

Q.4 Is Vedanta Ltd a good buy now?

Vedanta Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.
How efficiently has it utilized Capital?
By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.
How is it managing its Debt?
By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Vedanta Ltd?

Vedanta Ltd revenue growth is 6.4% for FY-2025, which is below its 5-year CAGR of 12.62%, indicating slower growth.

Q.2 Gross Profit margin of Vedanta Ltd?

Vedanta Ltd Gross profit margin which is the profit after deduction of direct costs, is 23.6% for FY-2025, which is in line with its 5-year median of 23.6%, indicating stable margins.

Q.3 Operating Profit Margin of Vedanta Ltd?

Vedanta Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 27.76% for FY-2025, which is in line with its 5-year median of 27.76% indicating stable margins.

Q.4 Net Profit Margin of Vedanta Ltd?

Vedanta Ltd Net Profit Margin is 13.42% for FY-2025, is in line with its 5-year median of 13.42%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	23.6	23.6
Operating Profit Margin (%)	27.76	27.76
Net Profit Margin (%)	13.42	13.42

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Vedanta Ltd?

Vedanta Ltd Return on Asset is 10.58%, which is above its 5-year historical median of 8.43%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Vedanta Ltd?

Vedanta Ltd Return on capital employed is 29.58% for FY-2025, which is above its 5-year historical median of 25.2%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.7 Return on Equity (ROE) of Vedanta Ltd?

Vedanta Ltd Return on equity is 57.42% for FY-2025, which is above its 5-year historical median of 27.76%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Vedanta Ltd?

Vedanta Ltd Cash conversion cycle is 8 days, below its 5-year historical median of 9 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	0.79	0.76
ROE (%)	57.42	27.76
ROCE (%)	29.58	25.2
Cash Conversion Cycle	8 days	9 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Vedanta Ltd?

Vedanta Ltd Debt-to-Equity ratio is 2.20, which is above the industry average of 0.39, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Vedanta Ltd?

Vedanta Ltd Debt to cash flow from operations is 2.28, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Vedanta Ltd?

Q.1 Promoter shareholding and pledge status of Vedanta Ltd?

Promoters hold 56.38% of the Vedanta Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Vedanta Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Vedanta Ltd vs industry peers?

Vedanta Ltd revenue CAGR is 12.62%, compared to the industry median CAGR of 12.85%, indicating stable growth and maintaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	6.4	12.9
Gross Profit Growth (%)	27.7	14.7
Operating Profit Growth (%)	20.3	15.4
Net Profit Growth (%)	172.4	21.1

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	0.79	0.83
ROE (%)	57.42	27.76
ROCE (%)	29.58	25.2
Cash Conversion Cycle (days)	7.74	9

Valuation & price assessment

Q.1 Stock return of Vedanta Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 13% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	13%	3.8%	4.7%	-24.2%

Q.2 Valuation ratios of Vedanta Ltd vs historical?

The current P/E ratio of 7.41 is lower than its historical median of 10.21, indicating that the stock is trading below its historical average valuation.

Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	7.41	10.21	27.16
Price to Book	2.6	3.91	2.29
Price to Sales	1.68	1.15	0.62
EV to EBITDA	6.15	5.47	12.16

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Check Before You Invest : Vedanta Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

Check more companies

Check trending companies

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