6-K 1 d65801d6k.htm FORM 6-K FORM 6-K
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 6-K

 

 

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the six month period ended September 30, 2020

Commission File 001 — 33175

 

 

Vedanta Limited

(Exact name of registrant as specified in the charter)

 

 

1st Floor, ‘C’ wing, Unit 103

Corporate Avenue, Atul Projects,

Chakala, Andheri (East),

Mumbai – 400 093, Maharashtra, India

(Address of Principal Executive Offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  ☒                Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

 

 

 


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CONVENTIONS USED IN THIS FORM

In this report, we refer to information regarding the zinc, oil and gas, iron ore, copper, aluminium, steel and power industries and our competitors from market research reports, analyst reports and other publicly available sources. Although we believe that this information is reliable, we have not independently verified the accuracy and completeness of the information. We caution you not to place undue reliance on this data.

Vedanta Resources Limited (“Vedanta”) is the parent company of our Company. We conduct our businesses both directly and through a consolidated group of companies that we have ownership interests in. See “Item 4. Information on the Company” in Annual Report (Form 20-F) for fiscal year ended March 31, 2020 for more information on these companies and their relationships to us. Unless otherwise stated in this report or unless the context otherwise requires, references in this report to “we”, “us”, “our”, “Vedanta Limited”, “our Company”, “the Company” or “our consolidated group of companies” mean Vedanta Limited, its consolidated subsidiaries and its predecessors, collectively, including Cairn India Limited (now Vedanta Limited - oil and gas business) and its subsidiaries (“Cairn”), Monte Cello BV (“Monte Cello”), Copper Mines of Tasmania Proprietary Limited (“CMT”), Thalanga Copper Mines Proprietary Limited, Bharat Aluminium Company Limited (“BALCO”), Hindustan Zinc Limited (“HZL”), Fujairah Gold FZC, Sterlite (USA), Inc., (“Sterlite USA”), Talwandi Sabo Power Limited (“TSPL”), THL Zinc Ventures Limited, THL Zinc Limited, THL Zinc Holding B.V., THL Zinc Namibia Holdings (Proprietary) Limited (“Skorpion”), Skorpion Zinc (Proprietary) Limited, Skorpion Mining Company (Proprietary) Limited, Namzinc (Proprietary) Limited, Amica Guesthouse (Proprietary) Limited, Rosh Pinah Health Care (Proprietary) Limited, Black Mountain Mining (Proprietary) Limited (“BMM”), Vedanta Lisheen Holdings Limited (“Lisheen”), Vedanta Lisheen Mining Limited, Killoran Lisheen Mining Limited, Killoran Lisheen Finance Limited, Lisheen Milling Limited, Vedanta Exploration Ireland Limited, Lisheen Mine Partnership, Sterlite Ports Limited, Vizag General Cargo Berth Private Limited, Paradip Multi Cargo Berth Private Limited, Lakomasko B.V., MALCO Energy Limited (“MALCO Energy”) (formerly known as Vedanta Aluminium), Sesa Resources Limited, Sesa Mining Corporation Limited, Bloom Fountain Limited (“BFL”), Goa Sea Port Private Limited, Western Cluster Limited (“WCL”), Maritime Ventures Private Limited, Vedanta Star Limited (“VSL”), Electrosteel Steels Limited (“ESL”), Avanstrate Inc.(“ASI”), Avanstrate Korea, Avanstrate Taiwan and Ferro Alloys Corporation Limited (“FACOR”), FACOR Power Limited (“FPL”).

Cairn India Limited (now Vedanta Limited’s - oil and gas business) merged into Vedanta Limited by way of a scheme of arrangement and the Board of Directors of both the companies made the merger operative on April 11, 2017 (the “Cairn India Merger”). All references to Vedanta Limited - oil and gas business and its subsidiaries is referred to as “Cairn”.

In this report, references to the “ADS offering” is to the initial public offering of our equity shares in the form of American Depositary Shares (“ADSs”), each currently representing four equity shares, in the United States (or the “US”) completed in June 2007.

Unless otherwise indicated, the unaudited condensed consolidated interim financial information for the six months period ended September 30, 2019 and 2020 have been prepared in accordance with International Accounting Standard 34 – Interim Financial Reporting as issued by International Accounting Standards Board (“IASB”), and for the fiscal year ended March 31, 2020 included in this report has been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by IASB. References to a particular “fiscal year” are to our fiscal year ended March 31 of that year. Our fiscal quarters end on June 30, September 30 and December 31. References to a year other than a “fiscal” year are to the calendar year ended December 31.

Our unaudited condensed consolidated interim financial statements are reported in Indian Rupees or “ ”. Unless otherwise specified, translation of amounts for the convenience of the reader has been made in this report from Indian Rupees to US dollars at the rate of  73.54 per $1.00 based on the exchange rate quoted by the Federal Reserve Bank of New York as at September 30, 2020. No representation is made that the Indian Rupee amounts represent US dollar amounts or have been, could have been or could be converted into US dollars at such rates or any other rate. All financial information presented in US dollars has been rounded to nearest decimal. Any amount less than US dollar 0.5 million has been presented as “0”.

In this report, references to “US” or the “United States” are to the United States of America, its territories and its possessions. References to “UK” are to the United Kingdom. References to “India” are to the Republic of India. References to “Namibia” are to the Republic of Namibia. References to “South Africa” are to the Republic of South Africa. References to “Ireland” are to the Republic of Ireland. References to “Sri Lanka” are to the Democratic Socialist Republic of Sri Lanka. References to “UAE” are to the United Arab Emirates. References to “$”, “dollars” or “US dollars” are to the legal currency of the United States. References to “Indian Rupees”, or “ ” are to the legal currency of the Republic of India. References to “AUD”, “Australian dollars” are to the legal currency of the Commonwealth of Australia. References to “NAD” or “Namibian dollars” are to the legal currency of Namibia. References to “ZAR” or “RAND” are to the legal currency of the Republic of South Africa. References to “¢” are to US cents. References to “RMB”, “Renminbi”, “CNY” or “Chinese Yuan” are to the legal currency of the People’s Republic of China. References to “JPY” are to the legal currency of Japan.

References to “lb” are to the imperial pounds (mass) equivalent to 0.4536 kilograms, references to “mt” or “tons” are to metric tons, references to “mmt” are to million metric tons, references to “tpd” are to tons per day, references to “tpa” are to tons per annum, a unit of mass equivalent to 1,000 kilograms or 2,204.6 lb, references to “mtpa” are to million tons per annum, “mmtpa” are to million metric tons per annum, references to “wmt” are to wet metric tons, references to “dmt” are to dry metric tons, references to “oz” are to ounces, with one kilogram being equivalent to 32.1507 oz and one ton equivalent to 32,151 oz, references to “mm” are to millimeters, references to “ha” are to hectares, references to “kms” are to kilometers, a unit of area equal to 10,000 square meters or 107,639 square feet, references to “GW” are to giga watts, references to “kt” are to kilo tons, references to “bbls” are to barrels, references to “blpd” are to barrels of liquid per day, references to “mmboe” are to million barrels of oil equivalent, references to “bboe” are to billion barrels of oil equivalent, references to “mmbopd” are to million barrels of oil per day, references to “kbopd” are to kilo barrels of oil per day, references to “bopd” are to barrels of oil per day, references to “boepd” are to barrels of oil equivalent per day, references to “tcm” are to trillion cubic meters, references to “mmscmd” are to million metric standard cubic meter per day, references to “mscf” are to million standard cubic feet, references to “mmscf” are to million metric standard cubic feet, references to “mmscfd” are to million metric standard cubic feet per day, references to “TWh” are to terawatt hours, references to “bcf” are to billion cubic feet, and references to “TcRc” are to treatment and refining charges. References to net oil and gas production are to the entitlement interest production of Vedanta Limited’s - oil and gas business and its subsidiaries, in which the Ravva royalty is not netted off. References to “GoI” are to Government of India.

 

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Our consolidated financial information does not include our controlling shareholder Vedanta, its shareholders and various companies owned directly or indirectly by it (other than us and our consolidated group of companies described above), including without limitations, Vedanta Resources Holdings Limited (“VRHL”), Konkola Copper Mines Plc, Twin Star Holdings Limited (“Twin Star”), Welter Trading Limited (“Welter Trading”), the Anil Agarwal Discretionary Trust (“Trust”), Conclave PTC Limited (“Conclave”), Volcan Investments Limited (“Volcan”), Volcan Investments Cyprus Limited, Sterlite Technologies Limited, Monte Cello Corporation NV, Valliant (Jersey) Limited, Vedanta Resources Jersey II Limited, Vedanta Resources Finance Limited, Vedanta Resources Cyprus Limited, Richter Holding Limited (“Richter”), Westglobe Limited (“Westglobe”), Finsider International Company Limited (“Finsider”), Vedanta Resources Jersey Limited, Vedanta Finance (Jersey) Limited, Vedanta Jersey Investments Limited, Vedanta Finance UK Limited, and Sterlite Grid Limited. References to the “Group” is to Vedanta Limited and its subsidiaries on a consolidated basis and references to the “Vedanta Group” is to Vedanta and its subsidiaries on a consolidated basis.

In this report, references to The London Metal Exchange Limited (“LME”) price of zinc, copper, aluminium are to the cash seller and settlement price on the LME for copper, zinc or aluminium for the period indicated.

 

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This form contains “forward-looking statements” as defined in the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations, assumptions, estimates and projections about our company and our industry. These forward-looking statements are subject to various risks and uncertainties. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “will,” “project,” “seek,” “should” and similar expressions. These forward-looking statements include, among other things, the discussions of our business strategy and expectations concerning our market position, future operations, margins, profitability, liquidity and capital resources. We caution you that reliance on any forward-looking statement involves risks and uncertainties, and that, although we believe that the assumptions on which our forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate and, as a result, the forward-looking statements based on those assumptions could be materially incorrect. Factors which could cause these assumptions to be incorrect include, but are not limited to:

 

   

changes resulting directly or indirectly due COVID 19 Pandemic;

 

   

regulatory, legislative and judicial developments and future regulatory actions and conditions in our operating areas;

 

   

dependence on obtaining and maintaining mining leases for our mining sites and approvals from regulatory authorities for increasing oil and gas production;

 

   

compliance with extensive environmental and health and safety regulations;

 

   

the future capital requirements of our business and the availability of financing on favorable terms;

 

   

construction of pipeline and terminal may take longer than planned, may not work as intended and the cost of construction may be greater than forecast;

 

   

a decline or volatility in the prices of or demand for zinc, oil and gas, iron ore, copper, aluminium, alloy, steel or power or increase in supply of zinc, oil and gas, iron ore, copper, aluminium, alloy, steel or power;

 

   

events that could cause a decrease in our production and higher cost of production for zinc, oil and gas, iron ore, copper, aluminium, alloy, steel or power;

 

   

unavailability or increased costs of raw materials for our products;

 

   

general risks related to Vedanta Limited’s commercial power business and challenges in operationalization of investment in aluminium and power business;

 

   

fluctuations in metal prices on LME, ore prices, oil and gas prices, steel prices or power prices;

 

   

interruptions in the availability of exploration, production or supply equipment or infrastructure and/or increased costs;

 

   

our actual economically recoverable lead-zinc ore, copper ore or bauxite reserves being lower than we have estimated;

 

   

our ability to expand our business, effectively manage our growth or implement our strategy;

 

   

our ability to retain our senior management team and hire and retain sufficiently skilled labor to support our operations;

 

   

increasing competition in the zinc, oil and gas, iron ore, copper, aluminium, steel or power industries;

 

   

political or economic instability in and around India or around the regions in which we operate;

 

   

worldwide economic and business conditions;

 

   

reliance on third party contractors and providers of equipment which may not be readily available and whose costs may increase;

 

   

our ability to successfully consummate strategic acquisitions; our ability to simplify our group structure and reduction in non-controlling stake in group companies;

 

   

the outcome of outstanding litigation in which we are involved;

 

   

our ability to maintain good relations with respective local communities and our trade unions and avoid protests, strikes and lock-outs;

 

   

the continuation of tax holidays, exemptions and deferred tax schemes we currently enjoy;

 

   

changes in tariffs, royalties, customs duties and government assistance;

 

   

terrorist attacks and other acts of violence, natural disasters, increasing impact of climate change and other environmental conditions and outbreaks of infectious diseases and other public health concerns in India, Asia and elsewhere ;

 

   

fluctuations in currency exchange rates;

 

   

failure of digital infrastructure and cyber security attacks due to negligence or IT security failures;

 

   

our ability to discover new reserves, enhance existing reserves or develop new operations in sufficient quantities to maintain or grow the current level of our reserves;

 

   

any actions of our controlling shareholder, Vedanta and

 

   

transitioning of zinc and lead mining operations from open pit to underground mining.

 

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In light of these and other uncertainties, you should not conclude that we will necessarily achieve any plans, objectives or projected financial results referred to in any of the forward-looking statements. Except as required by law, we do not undertake to release revisions to any of these forward-looking statements to reflect future events or circumstances.

 

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Index to Unaudited Condensed Consolidated Interim Financial Statements

 

     Page(s)  

Unaudited Condensed Consolidated Interim Statements of Profit or Loss for the six months ended September 30, 2019 and 2020

     F-2  

Unaudited Condensed Consolidated Interim Statements of Comprehensive Income for the six months ended September 30, 2019 and 2020

     F-3  

Unaudited Condensed Consolidated Interim Statements of Financial Position as at March 31, 2020 and September 30, 2020

     F-4  

Unaudited Condensed Consolidated Interim Statements of Cash Flows for the six months ended September 30, 2019 and 2020

     F-6  

Unaudited Condensed Consolidated Interim Statements of Changes in Equity for the six months ended September 30, 2019 and September 30, 2020

     F-8  

Notes to the Unaudited Condensed Consolidated Interim Financial Statements

     F-11  

 

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VEDANTA LIMITED AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF PROFIT OR LOSS

(In millions except share or per share amounts unless otherwise stated)

 

For the six months ended September 30,    Notes      2019     2020     2020  
            ( in
million)
    ( in
million)
    (US dollars
in million)
(Note 2 (a))
 

Revenue

        429,059       364,907       4,962  

Cost of sales

        (365,621     (280,578     (3,815
     

 

 

   

 

 

   

 

 

 

Gross profit

        63,438       84,329       1,147  

Other operating income

        4,742       6,152       84  

Distribution expenses

        (9,149     (8,289     (113

Administration expenses

        (16,976     (14,739     (200
     

 

 

   

 

 

   

 

 

 

Operating profit

        42,055       67,453       918  

Investment and other income

     6        14,570       15,518       211  

Finance and other costs

     7        (29,524     (26,224     (357
     

 

 

   

 

 

   

 

 

 

Profit before tax

        27,101       56,747       772  

Income tax (expense)/ credit

     8        9,671       (27,205     (370
     

 

 

   

 

 

   

 

 

 

Profit for the period

        36,772       29,542       402  

Profit attributable to:

         

Equity holders of the parent

        25,210       16,448       224  

Non-controlling interests

        11,562       13,094       178  
     

 

 

   

 

 

   

 

 

 

Profit for the period

        36,772       29,542       402  
     

 

 

   

 

 

   

 

 

 

Earnings per share

     9         

Basic

        6.81       4.44       0.06  

Diluted

        6.78       4.42       0.06  

Weighted average number of equity shares used in computing earnings per share

         

Basic

        3,702,506,169       3,703,288,875       3,703,288,875  

Diluted

        3,718,912,581       3,722,997,996       3,722,997,996  

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

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VEDANTA LIMITED AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

(In millions except share or per share amounts unless otherwise stated)

 

For the six months ended September 30,    2019     2020     2020  
     ( in
million)*
    ( in
million)
    (US dollars
in million)
(Note 2 (a))
 

Profit for the period

     36,772       29,542       402  

Other comprehensive income, net of income tax:

      

Items that will not be reclassified subsequently to profit or loss

      

Re-measurement of defined benefit obligation

     (1,171     (12     (0

Tax credit/(expense)

     396       (3     (0

(Loss)/Gain on fair value of financial asset investment

     (292     410       5  

Items that will be reclassified subsequently to profit or loss

      

Exchange differences on translation of foreign operations

     3,541       (1,491     (20

Tax (expense)/ credit

     (95     (216     (3

Gain/(loss) on cash flow hedges recognised during the period

     931       (838     (11

Tax (expense)/ credit

     (318     293       4  

(Gain)/loss on cash flow hedges recycled to profit or loss

     (68     549       7  

Tax credit/ (expense)

     8       (209     (3
  

 

 

   

 

 

   

 

 

 

Total other comprehensive income/(loss) for the period, net of income tax

     2,932       (1,517     (21
  

 

 

   

 

 

   

 

 

 

Total Comprehensive Income for the period

     39,704       28,025       381  
  

 

 

   

 

 

   

 

 

 

Total Comprehensive Income attributable to:

      

Equity holders of the parent

     28,568       14,885       202  

Non-controlling interests

     11,136       13,140       179  
  

 

 

   

 

 

   

 

 

 
     39,704       28,025       381  
  

 

 

   

 

 

   

 

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

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VEDANTA LIMITED AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

(Indian Rupees in million)

 

As at           March 31,
2020
    September 30,
2020
    September 30,
2020
 
     Notes      ( in
million)
    ( in
million)
    (US dollars in
million)
(Note 2 (a))
 

ASSETS

         

Non-current assets

         

Property, plant and equipment

        966,871       951,211       12,934  

Exploration and evaluation assets

        17,922       21,102       287  

Intangible assets

        7,790       7,763       106  

Deferred tax assets

        82,669       61,532       837  

Financial assets investments

        911       1,321       18  

Derivative Financial Assets

        25       —         —    

Income tax assets

        26,455       29,453       401  

Other non-current assets

        70,358       87,325       1,187  
     

 

 

   

 

 

   

 

 

 

Total non-current assets

        1,173,001       1,159,707       15,770  
     

 

 

   

 

 

   

 

 

 

Current assets

         

Inventories

        113,362       102,064       1,387  

Income tax assets

        75       63       1  

Trade and other receivables

        83,277       124,236       1,689  

Short-term investments

        327,210       277,148       3,769  

Derivative financial assets

        6,922       187       3  

Restricted cash and cash equivalents

     10        960       968       13  

Cash and cash equivalents

     11        50,598       77,175       1,049  
     

 

 

   

 

 

   

 

 

 

Total current assets

        582,404       581,841       7,911  
     

 

 

   

 

 

   

 

 

 

Total assets

        1,755,405       1,741,548       23,681  
     

 

 

   

 

 

   

 

 

 

LIABILITIES

         

Current liabilities

         

Borrowings

     12        212,231       229,812       3,125  

Acceptances

        101,851       89,874       1,222  

Trade and other payables

        310,660       264,712       3,599  

Derivative financial liabilities

        960       3,741       51  

Retirement benefits

        1,064       1,168       16  

Provisions

        2,471       2,424       33  

Current tax liabilities

        1,894       3,236       44  
     

 

 

   

 

 

   

 

 

 

Total current liabilities

        631,131       594,967       8,090  
     

 

 

   

 

 

   

 

 

 

Net current assets / (liabilities)

        (48,727     (13,126     (179
     

 

 

   

 

 

   

 

 

 

Non-current liabilities

         

Borrowings

     12        367,244       390,803       5,314  

Deferred tax liabilities

        29,675       27,464       374  

Retirement benefits

        1,614       1,620       22  

Provisions

        26,663       26,796       364  

Derivative financial liabilities

        451       974       13  

Other non-current liabilities

        16,732       13,810       188  
     

 

 

   

 

 

   

 

 

 

Total non-current liabilities

        442,379       461,467       6,275  
     

 

 

   

 

 

   

 

 

 

Total liabilities

        1,073,510       1,056,434       14,365  
     

 

 

   

 

 

   

 

 

 

Net assets

        681,895       685,114       9,316  
     

 

 

   

 

 

   

 

 

 

EQUITY

         

Share capital

     14        3,718       3,718       51  

Securities premium

        190,452       190,452       2,590  

Treasury shares

        (3,806     (3,543     (48

Share based payment reserve

        2,496       1,853       25  

 

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As at           March 31,
2020
     September 30,
2020
     September 30,
2020
 
     Notes      ( in
million)
     ( in
million)
     (US dollars in
million)
(Note 2 (a))
 

Other components of equity

        116,526        114,983        1,563  

Retained earnings

        203,135        219,336        2,982  
     

 

 

    

 

 

    

 

 

 

Equity attributable to equity holders of the parent

        512,521        526,799        7,163  

Non-controlling interests

        169,374        158,315        2,153  
     

 

 

    

 

 

    

 

 

 

Total Equity

        681,895        685,114        9,316  
     

 

 

    

 

 

    

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

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VEDANTA LIMITED AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

(Indian Rupees in million)

 

For the six months ended September 30,    2019     2020     2020  
     ( in
million)
    ( in
million)
    (US dollars in
million)
(Note 2 (a))
 

Cash flows from operating activities

      

Profit before tax

     27,101       56,747       772  

Adjustments to reconcile profit to net cash provided by operating activities:

      

Depreciation and amortisation

     49,545       39,440       536  
Impairment charge of property, plant and equipment/ exploration and evaluation assets/ other assets      5,040       —         —    

(Reversal)/ provision for doubtful debts/advances

     (49     (346     (5

Unsuccessful exploration costs written off

     2       15       0  

Fair value gain on financial assets at fair value through profit or loss

     (2,538     (7,790     (106

Share based payment expense

     461       360       5  

Loss/ (gain) on sale of property, plant and equipment, net

     416       (126     (2

Exchange Loss/ (gain), net

     366       (34     (0

Interest and dividend income

     (9,347     (7,340     (100

Interest expense

     26,813       25,642       349  

Liabilities written back no longer required

     —         (950     (13

Changes in assets and liabilities:

      

Decrease/ (increase) in receivables

     34,729       (12,764     (172

Decrease in inventories

     25,693       11,540       157  

(Decrease) in payable

     (45,028     (36,025     (489

Proceeds from short-term investments

     401,036       544,279       7,401  

Purchases of short-term investments

     (377,182     (462,734     (6,292
  

 

 

   

 

 

   

 

 

 

Cash generated from operations

     137,058       149,914       2,041  

Interest paid

     (34,685     (29,855     (407

Interest received

     4,411       16,039       217  

Dividends received

     312       17       0  

Income tax paid (net)

     (1,711     (10,494     (143
  

 

 

   

 

 

   

 

 

 

Net cash from operating activities

     105,385       125,621       1,708  
  

 

 

   

 

 

   

 

 

 

Cash flows from investing activities

      

Consideration paid for business acquisition (net of cash and cash equivalents acquired)

     (352     (447     (6

Purchases of property, plant and equipment (including intangibles)

     (40,789     (29,021     (395

Proceeds from sale of property, plant and equipment

     455       369       5  

Loans repaid by related parties

     —         3,743       51  

Loans to related parties

     —         (43,116     (586

Proceeds from short-term deposits

     13,846       95,184       1,294  

Purchases of short-term deposits

     (8,452     (127,712     (1,737

Proceeds on liquidation of structured investments

     30,774       —      

Payment towards structured investments

     (4,354     —      

Net changes in restricted cash and cash equivalents

     96       (9     (0
  

 

 

   

 

 

   

 

 

 

Net cash used in investing activities

     (8,776     (101,009     (1,374
  

 

 

   

 

 

   

 

 

 

Cash flows from financing activities

      

Repayment of working capital loan, net

     (63,330     (65,361     (888

Proceeds from acceptances

     86,604       121,709       1,655  

Repayment of acceptances

     (68,411     (133,970     (1,822

Proceeds from other short-term borrowings

     21,674       50,619       688  

Repayment of other short-term borrowings

     (19,980     (11,580     (157

Proceeds from long-term borrowings

     20,205       124,598       1,694  

Repayment of long-term borrowings

     (63,899     (58,199     (791

Payment of dividends to non-controlling interests

     —         (24,456     (333

Payment of lease liability

     (277     (1,660     (23

Share purchased by subsidiary

     (72     —         —    
  

 

 

   

 

 

   

 

 

 

 

F-6


Table of Contents
For the six months ended September 30,    2019     2020      2020  
     ( in
million)
    ( in
million)
     (US dollars in
million)
(Note 2 (a))
 

Net cash (used in)/ from financing activities

     (87,486     1,700        23  
  

 

 

   

 

 

    

 

 

 

Effect of exchange rate changes on cash and cash equivalents

     (528     265        4  
  

 

 

   

 

 

    

 

 

 

Net increase in cash and cash equivalents

     8,595       26,577        361  
  

 

 

   

 

 

    

 

 

 

Cash and cash equivalents at the beginning of the year

     72,291       50,598        688  

Cash and cash equivalents at the end of the period1

     80,886       77,175        1,049  

The accompanying notes are an integral part of these consolidated financial statements.

 

1.

For composition Refer Note 10 and Note 11

 

F-7


Table of Contents

VEDANTA LIMITED AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

(Indian Rupees in million except share or per share amounts unless otherwise stated)

 

(a)

For the six months ended September 30, 2019:

( in million)

 

     Attributable to equity holders of the parent              
     Share
capital
     Securities
premium
     Treasury
shares#
    Share based
payment reserve
    Translation of
foreign
operations
     Equity
Instruments
through OCI
    Cash
flow
hedges
    Retained
earnings*
    Total     Non-
controlling
interests
    Total  

Balance as at April 1, 2019

     3,718        190,452        (3,971     2,493       106,950        1,086       (734     281,344       581,338       150,608       731,946  

Profit for the period

     —          —          —         —         —          —         —         25,210       25,210       11,562       36,772  

Other comprehensive income for the period, net of tax

     —          —          —         —         3,674        (292     484       (508     3,358       (426     2,932  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total comprehensive income / (loss) for the period

     —          —          —         —         3,674        (292     484       24,702       28,568       11,136       39,704  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Stock options cancelled during the period

     —          —          —         (95     —          —         —         95       —         —         —    

Recognition of share based payment

     —          —          —         461       —          —         —           461       —         461  

Acquisition of non-controlling interest of ESL

     —          —          —         —         —          —         —         121       121       (736     (615

Change in fair value of put option liability/ conversion option asset/ derecognition of non-controlling interest

     —          —          —         —         —          —         —         (1,690     (1,690     1,535       (155
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance as at September 30, 2019

     3,718        190,452        (3,971     2,859       110,624        794       (250     304,572       608,798       162,543       771,341  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

*

Retained earnings mainly includes general reserve, debenture redemption reserve, preference share redemption reserve and capital reserve (Refer Note 14)

#

Treasury share represents 14,998,702 equity shares (face value of  1 each) of the Company purchased by Vedanta Limited ESOP Trust pursuant to the Company’s stock option scheme.

 

F-8


Table of Contents
(b)

For the year ended March 31, 2020:

( in million)

 

     Attributable to equity holders of the parent              
     Share
capital
     Securities
premium
     Treasury
shares#
    Share based
payment reserve
    Translation of
foreign
operations
     Equity
Instruments
through OCI
    Cash
flow
hedges
    Retained
earnings*
    Total     Non-
controlling
interests
    Total  

Balance as at April 1, 2019

     3,718        190,452        (3,971     2,493       106,950        1,086       (734     281,344       581,338       150,608       731,946  

Profit / (Loss) for the year

     —          —          —         —         —          —         —         (61,248     (61,248     19,148       (42,100

Other comprehensive income / (loss) for the year, net of tax

     —          —          —         —         9,498        (738     464       (926     8,298       (1,280     7,018  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total comprehensive income / (loss) for the year

     —          —          —         —         9,498        (738     464       (62,174     (52,950     17,868       (35,082
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Stock options cancelled during the year

     —          —          —         (519     —          —         —         519       —         —         —    

Recognition of share based payment

     —          —          —         754       —          —         —         —         754       —         754  

Exercise of stock options

     —          —          165       (232     —          —         —         67       0       0       0  

Dividend

     —          —          —         —         —          —         —         (14,441     (14,441     —         (14,441

Change in fair value of put option liability/ conversion option asset/ derecognition of non-controlling interest

     —          —          —         —         —          —         —         (3,448     (3,448     3,240       (208

Acquisition of Non-controlling interest in Electrosteel Steels Limited

     —          —          —         —         —          —         —         1,268       1,268       (2,342     (1,074
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance as at March 31, 2020

     3,718        190,452        (3,806     2,496       116,448        348       (270     203,135       512,521       169,374       681,895  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

*

Retained earnings mainly includes general reserve, debenture redemption reserve, preference share redemption reserve and capital reserve (Refer Note 14)

#

Treasury share represents 14,378,261 equity shares (face value of  1 each) of the Company purchased by Vedanta Limited ESOP Trust pursuant to the Company’s stock option scheme.

 

F-9


Table of Contents
(c)

For the six months ended September 30, 2020:

( in million)

 

     Attributable to equity holders of the parent              
     Share
capital
     Securities
premium
     Treasury
shares#
    Share based
payment reserve
    Translation of
foreign
operations
    Equity
Instruments
through OCI
     Cash
flow
hedges
    Retained
earnings*
    Total     Non-
controlling
interests
    Total  

Balance as at April 1, 2020

     3,718        190,452        (3,806     2,496       116,448       348        (270     203,135       512,521       169,374       681,895  

Profit / (Loss) for the period

     —          —          —         —         —         —          —         16,448       16,448       13,094       29,542  

Other comprehensive income / (loss) for the period, net of tax

     —          —          —         —         (1,880     410        (73     (20     (1,563     46       (1,517
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total comprehensive income / (loss) for the period

     —          —          —         —         (1,880     410        (73     16,428       14,885       13,140       28,025  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Stock options cancelled during the period

     —          —          —         (904     —         —          —         904       —         —         —    

Recognition of share based payment

     —          —          —         374       —         —          —         —         374       —         374  

Exercise of stock options

     —          —          263       (113     —         —          —         (150     0     0     0

Dividend

     —          —          —         —         —         —          —         —         —         (24,457     (24,457

Change in fair value of put option liability/ conversion option asset/ derecognition of non-controlling interest

     —          —          —         —         —         —          —         (981     (981     897       (84

Acquisition of FACOR

     —          —          —         —         —         —          —         —         —         (639     (639
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance as at September 30, 2020

     3,718        190,452        (3,543     1,853       114,568       758        (343     219,336       526,799       158,315       685,114  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance as at September 30, 2020 (US dollars in million)

     51        2,590        (48     25       1,558       10        (5     2,982       7,163       2,153       9,316  

 

*

Retained earnings mainly includes general reserve, debenture redemption reserve, preference share redemption reserve and capital reserve (Refer Note 14)

#

Treasury share represents 13,392,506 equity shares (face value of  1 each) of the Company purchased by Vedanta Limited ESOP Trust pursuant to the Company’s stock option scheme.

 

F-10


Table of Contents

VEDANTA LIMITED AND SUBSIDIARIES

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. GROUP OVERVIEW:

Vedanta Limited (“the Company” or “the parent”) and its consolidated subsidiaries (collectively, the “Group”) is a diversified natural resource group engaged in exploring, extracting and processing minerals and oil and gas. The Group engages in the exploration, production and sale of zinc, lead, silver, copper, aluminium, iron ore and oil and gas and have a presence across India, South Africa, Namibia, Ireland, Australia, Liberia and UAE. The Group is also in the business of commercial power generation, steel manufacturing and port operations in India and manufacturing of glass substrate in South Korea and Taiwan.

The Company was incorporated on September 8, 1975 under the laws of the Republic of India. The registered office of the Company is situated at 1st Floor, ‘C’ wing, Unit 103, Corporate Avenue, Atul Projects, Chakala, Andheri (East), Mumbai-400092, Maharashtra. The Company’s shares are listed on National Stock Exchange and Bombay Stock Exchange in India. In June 2007, the Company completed its initial public offering of American Depositary Shares, or ADS, each representing four equity shares, and listed its ADSs on the New York Stock Exchange. In July 2009, the Company completed its follow-on offering of an additional 131,906,011 ADSs, each representing four equity shares, which are listed on the New York Stock Exchange.

The Company is majority owned by Twin Star Holdings Limited (“Twin Star”), Finsider International Company Limited (“Finsider”), West Globe Limited (“West Globe”) and Welter Trading Limited (“Welter”) which are in turn wholly-owned subsidiaries of Vedanta Resources PLC (“VRPLC”), which was a public limited company incorporated in the United Kingdom and listed on the London Stock Exchange (VRPLC has been delisted from London Stock Exchange on October 1, 2018 and is renamed as “Vedanta Resources Limited” (“VRL”) with effect from October 29, 2018). Twin Star, Finsider, West Globe and Welter held 37.1%, 10.8%, 1.2% and 1.0% respectively of the Company’s equity as at September 30, 2020.

Details of Group’s various businesses are as follows.

 

 

Zinc India business is owned and operated by Hindustan Zinc Limited (“HZL”).

 

 

Zinc international business is comprised of Skorpion mine and refinery in Namibia operated through THL Zinc Namibia Holdings (Proprietary) Limited (“Skorpion”), Lisheen mine in Ireland operated through Vedanta Lisheen Holdings Limited (“Lisheen”) (Lisheen mine ceased operations in December 2015) and Black Mountain Mining (Proprietary) Limited (“BMM”), whose assets include the operational Black Mountain mine and the Gamsberg mine project located in South Africa.

 

 

The Group’s oil and gas business is owned and operated by the Company (prior to merger this was owned and operated by erstwhile Cairn India Limited) and its subsidiary, Cairn Energy Hydrocarbons Limited and consists of exploration and development and production of oil and gas (Refer Note 3(c)(I)(iv) below).

 

 

The Group’s iron ore business is owned by the Company, and by two wholly owned subsidiaries of the Company i.e. Sesa Resources Limited and Sesa Mining Corporation Limited and consists of exploration, mining and processing of iron ore, pig iron and metallurgical coke and generation of power for captive use. Pursuant to Honourable Supreme Court of India order, operations in the state of Goa are currently suspended. The Group’s iron ore business includes Western Cluster Limited (“WCL”) in Liberia which has iron ore assets and is wholly owned by the Group. WCL’s assets include development rights to Western Cluster and a network of iron ore deposits in West Africa. WCL’s assets have been fully impaired.

 

 

The Group’s copper business is owned and operated by the Company, Copper Mines of Tasmania Pty Ltd (“CMT”) and Fujairah Gold FZC and is principally one of custom smelting and includes captive power plants at Tuticorin in Southern India.

The Group’s copper business in Tamil Nadu, India has received an order from the Tamil Nadu Pollution Control Board (“TNPCB”) on April 09, 2018, rejecting the Company’s application for renewal of consent to operate under the Air and Water Acts for the 400,000 tpa copper smelter plant in Tuticorin for want of further clarification and consequently the operations were suspended. The Company has filed an appeal with TNPCB Appellate authority against the said order. During the pendency of the appeal, TNPCB through its order dated May 23, 2018 ordered for disconnection of electricity supply and closure of copper smelter plant. Post such order, the state government on May 28, 2018 ordered the permanent closure of the plant [Refer Note 3(c)(I)(iii)].

In addition, the Group owns and operates the Mt. Lyell copper mine in Tasmania, Australia through its subsidiary, CMT and a precious metal refinery and copper rod plant in Fujairah, UAE through its subsidiary Fujairah Gold FZC. The operations of Mt Lyell copper mine were suspended in January 2014 following a mud slide incident and were put into care and maintenance since July 09, 2014 following a rock fall incident in June 2014.

 

 

The Group’s Aluminium business is owned and operated by the Company and by Bharat Aluminium Company Limited (“BALCO”). The aluminium operations include a refinery and captive power plant at Lanjigarh and a smelter and captive power plants at Jharsuguda both situated in the State of Odisha in India. BALCO’s partially integrated aluminium operations are comprised of two bauxite mines, captive power plants, smelting and fabrication facilities in the State of Chattisgarh in central India.

 

F-11


Table of Contents
 

The Group’s power business is owned and operated by the Company, BALCO, and Talwandi Sabo Power Limited (“TSPL”), a wholly owned subsidiary of the Company, which are engaged in the power generation business in India. The Company power operations include a thermal coal- based commercial power facility of 600 MW at Jharsuguda in the State of Odisha in Eastern India. BALCO power operations included 600 MW (2 units of 300 MW each) thermal coal based power plant at Korba, of which a unit of 300 MW was converted to be used for captive consumption vide order from Central Electricity Regulatory Commission (CERC) dated January 1, 2019. Talwandi Sabo Power Limited (“TSPL”) power operations include 1,980 MW (three units of 660 MW each) thermal coal- based commercial power facilities. Power business also includes the wind power plants commissioned by HZL and a power plant at MALCO Energy Limited (“MEL”) (under care and maintenance) situated at Mettur Dam in the State of Tamil Nadu in southern India.

 

 

The Group’s other activities include Electrosteel Steels Limited (“ESL”). ESL is engaged in the manufacturing and supply of billets, TMT bars, wire rods and ductile iron pipes in India. The Group’s other activities also include Vizag General Cargo Berth Private Limited (“VGCB”) and Maritime Ventures Private Limited (“MVPL”). Vizag port project includes mechanization of coal handling facilities and upgradation of general cargo berth for handling coal at the outer harbour of Visakhapatnam Port on the east coast of India. MVPL is engaged in the business of rendering logistics and other allied services inter alia rendering stevedoring, and other allied services in ports and other allied sectors. The Group’s other activities also include AvanStrate Inc. (“ASI”) and Ferro Alloys Corporation Limited (“FACOR”). ASI is involved in the manufacturing of glass substrate in South Korea and Taiwan. FACOR was acquired on September 21, 2020 and is involved in business of producing Ferro Alloys and owns a Ferro Chrome plant with capacity of 72,000 TPA, two operational Chrome mines and 100 MW of Captive Power Plant through its subsidiary, FACOR Power Limited (FPL).

Delisting of Vedanta Limited

The Company vide letter dated May 12, 2020 had informed the stock exchanges that it has received a letter dated May 12,2020 from its Holding Company, Vedanta Resources Ltd. (“VRL”), wherein VRL had expressed its intention to, either individually or along with one or more subsidiaries, acquire all fully paid-up equity shares of the Company (“Equity Shares”) that are held by the public shareholders of the Company (as defined under the Delisting Regulations, to be referred to as “Public Shareholders”) and consequently voluntarily delist the Equity Shares from BSE Limited and National Stock Exchange of India Limited, the recognized stock exchanges where the Equity Shares are presently listed (“Stock Exchanges”), in accordance with the Delisting Regulations (“Delisting Proposal”) and if such delisting is successful, then to also delist the Company’s American Depositary Shares from the New York Stock Exchange (“NYSE”) and deregister the Company from the Securities and Exchange Commission (“SEC”), subject to the requirements of the NYSE and the SEC.

After obtaining due approvals, the Public Shareholders holding Equity Shares were invited to submit Bids pursuant to the reverse book building process conducted through the Stock Exchange Mechanism made available by BSE during the bid period (05 October 2020 to 09 October 2020), in accordance with the Delisting Regulations.

The total number of Offer Shares validly tendered by the Public Shareholders in the Delisting Offer was 1,25,47,16,610 Offer Shares, which was less than the minimum number of Offer Shares required to be accepted by the Acquirers in order for the Delisting Offer to be successful in terms of Regulation 17(1)(a) of the Delisting Regulations. Thus, the Delisting Offer is deemed to have failed in terms of Regulation 19(1) of the Delisting Regulations.

 

F-12


Table of Contents

NOTES TO THE FINANCIAL STATEMENTS

2. Basis of preparation and basis of measurement of financial statements

a) Basis of Preparation

These unaudited condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 – Interim Financial Reporting as issued by International Accounting Standards Board (“IASB”).

The unaudited condensed consolidated interim financial statements do not include all of the information and disclosures required in the annual financial statements and should be read in conjunction with the Group’s annual financial statements for the year ended March 31, 2020.

These financial statements are approved for issue by the Board of Directors on December 23, 2020.

Certain comparative figures appearing in these condensed consolidated interim financial statements have been regrouped and/or reclassified to better reflect the nature of those items.

The condensed consolidated interim financial statements are presented in Indian Rupee ( ), the presentation currency of the Company. Solely for the convenience of readers, the condensed consolidated interim financial statements as at and for the period ended September 30, 2020 have been translated into US dollars (“$”) at the noon buying rate of $ 1.00 =  73.5400 in the City of New York for cable transfers of Indian Rupee as certified for customs purposes by the Federal Reserve Bank of New York on September 30, 2020. No representation is made that the Indian Rupee amounts represent US dollar amounts or have been, could have been or could be converted into US dollars at such a rate or any other rate.

b) Basis of Measurement

For the year ended March 31, 2020, considering the uncertainties caused due to Covid-19 as described in note 3(c)(I)(i), the Group prepared its cash flow forecasts under various scenarios and performed additional sensitivities on certain key assumptions. Based on such an analysis and assessment of its ability to raise additional capital, the Group continues to prepare its financial statements on a going concern basis. While performing such an analysis, the Group has also considered and evaluated the consequential effects of the fact that its parent company Vedanta Resources Limited (VRL) has reported a material uncertainty relating to its going concern in its most recent financial statements for March 2020. Upon a consideration of the foregoing, the Group has concluded that no substantial change in its operations are expected.

The condensed consolidated interim financial statements have been prepared on a going concern basis using historical cost convention and on an accrual method of accounting, except for certain financial assets and liabilities which are measured at fair value.

3(a). Accounting policies

These unaudited condensed consolidated interim financial statements have been prepared using the same accounting policies as applied in the audited consolidated financial statements as of March 31, 2020, except for those mentioned in 3(b) below.

3(b). Application of new and revised standards

The Group has adopted, with effect from April 01, 2020, the following new and revised standards and interpretations. Their adoption has not had any material impact on the amounts reported in the condensed consolidated interim financial statements.

 

  1.

Amendments to IFRS 3 regarding definition of a Business

 

  2.

Amendments to IFRS 7 and 9 regarding Interest Rate Benchmark Reform

 

  3.

Amendments to IAS 1 and IAS 8 regarding definition of Material

 

  4.

Amendments to IFRS 16 regarding COVID-19 related rent concessions

Standards issued but not yet effective

The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Group’s condensed consolidated interim financial statements are not expected to have a significant impact on the Group condensed consolidated interim financial statements. The Group has not early adopted any amendment, standard or interpretation that has been issued but is not yet effective.

 

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3(c) Significant accounting estimates

The preparation of condensed consolidated interim financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions, that affect the application of accounting policies and the reported amounts of assets, liabilities, income, expenses and disclosures of contingent assets and liabilities at the date of these condensed consolidated interim financial statements and the reported amounts of revenues and expenses for the periods presented. These judgments and estimates are based on management’s best knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ materially from the amounts included in the financial statements.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and future periods affected.

The information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements are as given below:

I. Significant Estimates:

 

(i)

Impact of COVID-19

The outbreak of novel Coronavirus (COVID-19) pandemic globally and in India and the consequent lockdown restrictions imposed by national governments is causing significant disturbance and slowdown of economic activity across the globe. The commodity prices including oil have seen significant volatility with downward price pressures due to major demand centers affected by lockdown.

The Group is in the business of metals and mining, Oil & gas and generation of power which are considered as either essential goods and services or were generally allowed to continue to carry out the operations with adequate safety measures. The Group has taken proactive measures to comply with various regulations/guidelines issued by the Government and local bodies to ensure safety of its workforce and the society in general.

The Group has considered possible effects of Covid-19 on the recoverability of its investments, property, plant and equipment (PPE), inventories, loans and receivables, etc. in accordance with IFRS. The Group has considered forecast consensus, industry reports, economic indicators and general business conditions to make an assessment of the implications of the Pandemic. The Group has also performed sensitivity analysis on the assumptions used basis the internal and external information/ indicators of future economic condition. Based on the assessment, the Group had recorded necessary adjustments, including impairment to the extent the carrying amount exceeds the recoverable amount in its financial statements for the year ended March 31, 2020. The actual effects of COVID-19 could be different from what is presently assessed and would be known only in due course of time, however no further adjustments are considered necessary at this stage.

 

(ii)

Recoverability of deferred tax and other income tax assets

The Group has carry forward tax losses, unabsorbed depreciation and MAT credit that are available for offset against future taxable profit. Deferred tax assets are recognised only to the extent that it is probable that taxable profit will be available against which the unused tax losses or tax credits can be utilized. This involves an assessment of when those assets are likely to reverse, and a judgement as to whether or not there will be sufficient taxable profits available to offset the assets. This requires assumptions regarding future profitability, which is inherently uncertain. To the extent assumptions regarding future profitability change, there can be an increase or decrease in the amounts recognised in respect of deferred tax assets and consequential impact in the consolidated statement of profit and loss.

Based on the above analysis, the total deferred tax assets recognised in these financial statement includes MAT credit entitlements of  91,258 million and  87,020 million ($ 1,183 million) as at March 31, 2020 and September 30, 2020 respectively, of which  35,998 million ($ 490 million) is expected to be utilised in the fourteenth and the fifteenth year. As per tax laws such credits are to be utilised within fifteen years of origination.

Additionally, the Group has tax receivables on account of refund arising on account of past amalgamation and relating to various tax disputes. The recoverability of these receivables involve application of judgement as to the ultimate outcome of the tax assessment and litigations. This pertains to the application of the legislation, which in certain cases is based upon management’s interpretation of country specific tax law, in particular India, and the likelihood of settlement. Management uses in-house and external legal professionals to make informed decision.

 

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(iii)

Copper operations India

In an appeal filed by the Group against the closure order of the Tuticorin Copper smelter by Tamil Nadu Pollution Control Board (“TNPCB”), the appellate authority National Green Tribunal (“NGT”) passed an interim order on May 31, 2013 allowing the copper smelter to recommence operations and appointed an Expert Committee to submit a report on the plant operations. Post the interim order, the plant recommenced operations on June 23, 2013. Based on Expert Committee’s report on the operations of the plant stating that the plant’s emission were within prescribed standards and based on this report, NGT ruled on August 08, 2013 that the Copper smelter could continue its operations and recommendations made by the Expert Committee be implemented in a time bound manner. The Group has implemented all of the recommendations. TNPCB has filed an appeal against the order of the NGT before the Supreme Court of India.

In the meanwhile, the application for renewal of Consent to Operate (CTO) for existing copper smelter, required as per procedure established by law was rejected by TNPCB in April 2018. Vedanta Limited has filed an appeal before the TNPCB Appellate Authority challenging the Rejection Order. During the pendency of the appeal, there were protests by a section of local community raising environmental concerns and TNPCB vide its order dated May 23, 2018 ordered closure of existing copper smelter plant with immediate effect. Further, the Government of Tamil Nadu, issued orders dated May 28, 2018 with a direction to seal the existing copper smelter plant permanently. The Company believes these actions were not taken in accordance with the procedure prescribed under applicable laws. Subsequently, the Directorate of Industrial Safety and Health passed orders dated May 30, 2018, directing the immediate suspension and revocation of the Factory License and the Registration Certificate for the existing smelter plant.

The Company has appealed this before the National Green Tribunal (NGT). NGT vide its order on December 15, 2018 has set aside the impugned orders and directed the TNPCB to pass fresh orders for renewal of consent and authorization to handle hazardous substances, subject to appropriate conditions for protection of environment in accordance with law.

The State of Tamil Nadu and TNPCB approached Supreme Court in Civil Appeals on January 02, 2019 challenging the judgement of NGT dated December 15, 2018 and the previously passed judgement of NGT dated August 08, 2013. The Supreme Court vide its judgement dated February 18, 2019 set aside the judgements of NGT dated December 15, 2018 and August 08, 2013 on the basis of maintainability alone and directed the Company to file an appeal in High court.

The Company had filed a writ petition before Madras High Court challenging the various orders passed against the Company in 2018 and 2013. On August 18, 2020, the Madras High Court delivered the judgement wherein it dismissed all the Writ Petitions filed by the Company. The Company has approached the Supreme Court and challenged the said High Court order by way of a Special Leave Petition (SLP) to Appeal and also filed an interim relief for care & maintenance of the plant. The matter was then listed on December 02, 2020 before Supreme Court Bench. The Bench after having heard both the sides concluded that at this stage the interim relief in terms of trial run could not be allowed. Further, considering the voluminous nature of documents and pleadings, the matter shall be finally heard on merits. The case will be listed once physical hearing resumes in Supreme court.

As per the Company’s assessment, it is in compliance with the applicable regulations and expects to get the necessary approvals in relation to the existing operations.

The Company has carried out an impairment analysis for existing plant assets during the six months ended September 30, 2020 considering the key variables and concluded that there exists no impairment. The Company has done an additional sensitivity analysis with commencement of operations of the existing plant in FY 2022-23 and noted that the recoverable amount of the assets would still be in excess of their carrying values.

The carrying value of the assets as at March 31, 2020 was  19,487 million and September 30, 2020 is  18,854 million ($ 256 million).

Expansion Plant:

Separately, the Company has filed a fresh application for renewal of the Environmental Clearance (EC) for the proposed Copper Smelter Plant 2 (Expansion Project) dated March 12, 2018 before the Expert Appraisal Committee of the MoEF wherein a sub-committee was directed to visit the Expansion Project site prior to prescribing the Terms of Reference.

In the meantime, the Madurai Bench of the High Court of Madras in a Public Interest Litigation held vide its order dated May 23, 2018 that the application for renewal of the Environmental Clearance for the Expansion Project shall be processed after a mandatory public hearing and in the interim, ordered the Company to cease construction and all other activities on site for the proposed Expansion Project with immediate effect. The Ministry of Environment and Forests (MoEF) has delisted the expansion project since the matter is sub-judice. Separately, SIPCOT vide its letter dated May 29, 2018, cancelled 342.22 acres of the land allotted for the proposed Expansion Project. Further the TNPCB issued orders on June 07, 2018 directing the withdrawal of the Consent to Establish (CTE) which was valid till March 31, 2023.

 

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The Company has approached Madras High Court by way of writ petition challenging the cancellation of lease deeds by SIPCOT pursuant to which an interim stay has been granted. The Company has also filed Appeals before the TNPCB Appellate Authority challenging withdrawal of CTE by the TNPCB, the matter is pending for adjudication. Considering the delay in existing plant matter and accordingly delay in getting the required approval for expansion project, management considered to make provision for impairment for expansion project basis fair value less cost of disposal and accordingly made impairment provision of  6,692 million in March 2020. During the current period, there are no updates in the expansion matter and impairment provision of  6,692 million is adequate.

 

iv)

PSC Extension

Rajasthan Block

On October 26, 2018, the Government of India (GoI), acting through the Directorate General of Hydrocarbons (DGH) granted its approval for a ten-year extension of the Production Sharing Contract (PSC) for the Rajasthan Block (RJ), with effect from May 15, 2020 subject to certain conditions. The GoI had granted the extension under the Pre-NELP Extension Policy, the applicability whereof to PSC for Rajasthan Block is sub-judice and pending before the Hon’ble Delhi High Court. The key conditions stated by DGH and the Group’s position is detailed below:

 

   

Submission of Audited Accounts and End of year statement:

The Companies and one of the joint operation partners have divergent views on the cost oil entitlement and therefore the End of Year statement for the year ended March 31, 2018 & March 31, 2019 and the Investment Multiple as at March 31, 2018 and as at March 31, 2019 could not be finalized. Consequentially, profit petroleum pertaining to the said Block for the year ended March 31, 2019 and March 31, 2020 and applicable Investment Multiple calculated based on management’s cost oil computation (resulting into Government’s share of profit petroleum @ 40% for DA-1 & DA-2 and @20% for DA-3 for FY 2019 & FY 2020), remains provisional. The computation is after considering relevant independent legal advice. Subsequently, Audited End of year statements for FY 18-19 and FY 19-20 have been submitted to DGH on September 19, 2020 and audited End of year statement for FY 17-18 was also submitted on November 12, 2020.

Further, the above condition for submission of audited accounts and End of Year Statement for adoption by Management Committee of the Block has been delinked by DGH vide letter dated December 03, 2019 as a pre-condition to PSC extension.

Profit Petroleum: DGH, in May 2018, has raised a demand for the period up to March 31, 2017 for Government’s additional share of Profit oil based on its computation of disallowance of cost incurred over the initially approved Field Development Plan (FDP) of pipeline project for  15,079 million ($ 202 million) and retrospective re-allocation of certain common costs between Development Areas (DAs) of Rajasthan Block aggregating to  27,236 million ($ 364 million), representing share of Vedanta Limited and its subsidiary. DGH vide its letter dated May 12, 2020, reiterated its demand only with respect to the retrospective re-allocation of certain common costs between Development Areas (DA’S) of Rajasthan block of  27,236 million ($ 364 million) for the period upto March 31, 2017.

Subsequently, the Company in January 2020 received notifications from DGH on audit exceptions arising out of its audit for the FY 2017-18, which comprises of the consequential effects on profit oil due to the aforesaid matters and certain new matters on cost allowability plus interest aggregating to  48,284 million ($ 645 million), representing share of Vedanta limited and its subsidiary, which have been suitably responded to by the Company.

The Company believes that it has sufficient as well as reasonable basis (pursuant to PSC provisions & approvals), supported by legal advice, for having claimed such costs and for allocating common costs between different DAs. In the Company’s opinion, these computations of the aforesaid demand / audit exceptions are not appropriate and the accounting adjustments sought for issues pertaining to Year 2007 and onwards are based on assumptions that are not in consonance with the approvals already in place. The Company’s view is also supported by independent legal opinion and the Company has been following the process set out in PSC to resolve these aforesaid matters. Thus, the Company sought for appointment of a sole expert for opining on the audit exceptions by a letter dated November 14, 2019 and thereafter on May 14, 2020, Company has issued a notice of Arbitration proceeding on the above matters and is confident of resolution of matters in its favor. The Tribunal stands constituted. Further, on September 23, 2020, GoI had filed an application for interim relief before Delhi High Court seeking payment of all disputed dues. The bench was not inclined to pass any ex-parte orders and now the matter is scheduled for hearing on December 23, 2020.

Further to above stated letter from GoI on October 26,2018, in view of pending non-finalization of the Addendum to PSC, the extraordinary situation prevailing on account of COVID-19 and non-finalisation of issues including the aforesaid DGH demand, the GoI granted permission to the Group to continue petroleum operations in RJ-ON-90/I block, till the execution of the Addendum to PSC or for a period upto January 31, 2021, whichever is earlier.

 

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In our view, above mentioned condition linked to PSC extension is untenable and has not resulted in creation of any liability and cannot be a ground for non-extension. In addition, all necessary procedures prescribed in the PSC including appropriate dispute resolution process, in respect of the stated audit observation have also been satisfied. Accordingly, in our view, the PSC extension approval granted vide DGH letter dated October 26, 2018 upholds with all conditions addressed and no material liability would devolve upon the Group.

 

(v)

Flue-gas desulfurization (FGD) implementation:

Ministry of Environment, Forest and Climate Change (MOEF&CC) has revised emission norms for coal-based power plants in India. Accordingly, both captive and independent coal-based power plants in India are required to comply with these revised norms for reduction of sulphur oxide (SOx) emissions for which the current plant infrastructure is to be modified or new equipment’s have to be installed. Timelines for compliance to the revised norm for various plants in the Group range from December 2019 to March 2022. Different power plants are at different stages of the implementation process. However, it is unlikely that the implementation would be completed by the stipulated date.

MOP issued notification dated 02/07/2020 to restrict imports from China. Power China SEPCO1 has communicated their inability to execute the FGD project quoting aforementioned MOP notification and prevailing COVID situation in India. TSPL is proceeding with further steps for retendering the FGD project. A show cause notice has been issued by Central Pollution Control Board (‘CPCB’) to TSPL and other power plants which were required to meet December 31, 2019 deadline. Further, CPCB vide notice dated May 08, 2020 published on its website, has imposed penalty of  2 million per month per non-compliant unit and any further directions based on the periodic review of compliance status. Subsequent to period end, CPCB has extended the timelines to install FGD at TSPL to February 28, 2021 for Unit-1, December 31, 2020 for Unit-2 and October 31, 2020 for Unit-3.

TSPL filed a petition before Punjab State Electricity Regulatory Commission (PSERC) for approval of MoEF notification as change in law in terms of Article 13 of PPA on June 30, 2017. PSERC vide its order dated December 21, 2018 has held that MoEF notification is not a change in law as it does not impose any new requirements. TSPL had filed an appeal before Hon’ble Appellate Tribunal for Electricity (APTEL) challenging the said order of PSERC. APTEL has pronounced the order on August 28, 2020 in favour of TSPL allowing the cost pass through. PSPCL has filed an appeal against this order in Supreme Court.

Similarly, other power plants of the Group in India are required to comply with the revised norms in the coming year(s). Group’s respective operations have been engaging with the concerned authorities to extend the timeline for compliance. The timelines have been extended for BALCO and Aluminum business of the Company to June 2021.

(vi) ESL Steel Limited (formerly known as Electrosteel Steels Limited) (ESL), had filed application for renewal of Consent to Operate (‘CTO’) on August 24, 2017 for the period of five years which was denied by Jharkhand State Pollution Control Board (‘JSPCB’) on August 23, 2018, as JSPBC awaited response from MOEF over a 2012 show-cause notice. After a personal hearing towards the show cause notice, the Ministry of Environment, Forests and Climate Change revoked the Environmental Clearance (EC) on September 20, 2018. The Hon’ble High Court of Jharkhand granted stay against both revocation orders, and allowed the continuous running of the plant operations under regulatory supervision of the JSPCB. Jharkhand High Court on September 16, 2020 passed an order vacating the interim stay in place beyond September 23, 2020, while listed the matter for final hearing in November 2020. ESL urgently filed an SLP in the Supreme Court, and on September 22, 2020, ESL was granted permission to run the plant till further orders.

As the courts had permitted ESL to apply for statutory clearances without prejudice to their rights, ESL has been granted stage I forest clearance by MOEF&CC in December 2019 and Terms of Reference for 3 MTPA steel plant in August 2020. The company is working aggressively to comply with the terms of reference to secure the revised EC immediately, and does not envisage a material liability in this aspect.

4. Business Combination

Ferro Alloys Corporation Limited - Business Combination

On September 21, 2020, the Company acquired control over Ferro Alloys Corporation Limited (“FACOR”). FACOR was admitted under Corporate insolvency resolution process in terms of the Insolvency and Bankruptcy Code, 2016 of India. The National Company Law Tribunal (NCLT) vide its order dated January 30, 2020 approved the resolution plan for acquiring controlling stake in FACOR. Pursuant to the approved resolution plan, FACOR will be wholly owned subsidiary of the Company. FACOR holds 90% in its subsidiary, Facor Power Limited (FPL).

FACOR is in the business of producing Ferro Alloys and owns a Ferro Chrome plant with capacity of 72,000 TPA, two operational Chrome mines and 100 MW of Captive Power Plant through its subsidiary, FACOR Power Limited (FPL). The acquisition will complement the Group’s existing steel business as the vertical integration of ferro manufacturing capabilities has the potential to generate significant efficiencies.

 

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The business combination has been accounted for on a provisional basis under IFRS 3.

The fair value of the identifiable assets and liabilities of FACOR as at the date of the acquisition were provisionally estimated as below:

 

     ( in million)      ($ in million)  

Particulars

   Provisional Fair Value      Provisional Fair Value  

Property, Plant and Equipment including Capital work in progress

     580        8  

Capital work-in-progress

     1,020        14  

Intangible assets

     101        1  

Bank deposits

     40        1  

Other non-current assets

     160        2  
  

 

 

    

 

 

 

Non-current assets

     1,901        26  
  

 

 

    

 

 

 
     ( in million)      ($ in million)  

Particulars

   Provisional Fair Value      Provisional Fair Value  

Inventories

     460        6  

Trade and other receivables

     367        5  

Cash and cash equivalents

     113        2  

Short-term Investments

     699        10  

Income tax assets

     13        0  

Current assets

     1,652        23  
  

 

 

    

 

 

 

Total Assets (A)

     3,553        49  
  

 

 

    

 

 

 

Borrowings

     77        1  

Other liabilities

     1,193        16  
  

 

 

    

 

 

 

Total Liabilities (B)

     1,270        17  
  

 

 

    

 

 

 

Net Assets (C = A-B)

     2,283        31  
  

 

 

    

 

 

 

Satisfied by:

     

Cash Consideration Paid for Equity acquired

     340        5  

Cash Consideration Paid for Debt acquired

     220        3  

Zero coupon Non Convertible Debentures issued by FACOR repayable equally over 4 years commencing March 2021 (Nominal value 2,865 million)*

     2,362        32  
  

 

 

    

 

 

 

Total Purchase consideration (D)

     2,922        40  
  

 

 

    

 

 

 

Non-Controlling interest on acquisition (10% of net liabilities of FPL) (E)

     (639      (9

Bargain Gain/Goodwill (C-D-E)

     0        0  

 

*

Includes NCDs of nominal value  23 million ($ 0 million) yet to be issued as part of purchase consideration.

Considering the time involved in the valuation and complexities involved in the acquired business, the Group is still in the process of finalizing the fair valuation, which is expected to be finalized by the year end. As a result, the effects of the same have been accounted for on a provisional basis, as permitted by IFRS 3.

 

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Table of Contents

Since the date of acquisition, FACOR has contributed Nil and Nil to the Group revenue and profit before taxation respectively for the six months ended September 30, 2020. If FACOR had been acquired at the beginning of the year, the Group revenue would have been  367,147 million ($ 4,992 million) and the profit before exceptional items and tax of the Group would have been  55,591 million ($ 756 million).

Non-controlling interest has been measured at the non-controlling interest’s proportionate share of FPL’s identifiable net assets.

Acquisition costs of  28 million ($ 0 million) have been charged to the consolidated statement of profit and loss.

5. Segment information

Description of segment and principal activities

The Group is a diversified natural resource group engaged in exploring, extracting and processing minerals and oil and gas. The Group produces zinc, lead, silver, copper, aluminium, iron ore, oil and gas and commercial power and has a presence across India, South Africa, Namibia, U.A.E, Ireland, Australia, Japan, South Korea, Taiwan and Liberia. The Group is also in the business of port operations and manufacturing of glass substrate and steel. The Group has seven reportable segments: copper, aluminium, iron ore, power, Zinc India (comprises of zinc and lead India), Zinc international, oil and gas and others. The management of the Group is organized by its main products: copper, Zinc (comprises of zinc and lead India, silver India and zinc international), aluminium, iron ore, oil and gas, power and others. ‘Others’ segment mainly comprises of port/berth, steel, glass substrate and ferro alloys business and those segments which do not meet the quantitative threshold for separate reporting. Each of the reportable segments derives its revenues from these main products and hence these have been identified as reportable segments by the Group’s chief operating decision maker (“CODM”).

Segment Revenue, Profit, Assets and Liabilities include the respective amounts identifiable to each of the segments and amount allocated on a reasonable basis. Unallocated expenditure consists of common expenditure incurred for all the segments and expenses incurred at corporate level. The assets and liabilities that cannot be allocated between the segments are shown as unallocated assets and unallocated liabilities respectively.

The accounting policies of the reportable segments are the same as the Group’s accounting policies. The operating segments reported are the segments of the Group for which separate financial information is available. Earnings before interest, depreciation and amortisation and tax (Segment profit) are evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance and is a non-IFRS measure. The Group’s financing (including finance and other costs and investment and other income) and income taxes are reviewed on an overall basis and are not allocated to operating segments.

Transfer prices between operating segments are on an arm’s length basis in a manner similar to transactions with third parties.

 

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a. For the six months ended September 30, 2019

 

     Copper
(
in
million)
    Zinc India
(
in
million)
    Zinc
International
(
in
million)
    Aluminium
(
in
million)
    Power
(
 in
million)
    Iron Ore
(
in
million)
    Oil and Gas
(
in
million)
    Others
(
in
million)
    Elimination
(
in
million)
    Total
( in
million)
 

Revenue

                    

Sales

     49,618       92,660       17,145       134,040       33,491       15,521       63,269       23,315       —         429,059  

Inter-segment sales

     —         —         —         62       673       23       —         432       (1,190     —    

Segment revenue

     49,618       92,660       17,145       134,102       34,164       15,544       63,269       23,747       (1,190     429,059  

Cost of Sales and expenses

     (51,278     (47,710     (13,800     (133,480     (26,049     (12,382     (26,712     (21,858     1,190       (332,079

Segment profit / (loss)

     (1,660     44,950       3,345       622       8,115       3,162       36,557       1,889       —         96,980  

Depreciation and amortisation

     (742     (11,289     (3,446     (8,191     (2,916     (1,340     (19,292     (2,329     —         (49,545

Other items**

     —         —         —         —         —         —         —         —         —         (340

Impairment

     —         —         —         —         —         —         —         (5,040     —         (5,040
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating profit / (loss)

     (2,402     33,661       (101     (7,569     5,199       1,822       17,265       (5,480     —         42,055  

Investment and other income

                       14,570  

Finance and other costs

                       (29,524
                    

 

 

 

Profit before tax

                       27,101  
                    

 

 

 

b. As at March 31, 2020

 

Assets and liabilities

 

           

Assets

                    

Segment assets

     64,853       206,643       51,831       486,545       174,210       34,450       155,551       80,247         1,254,330  

Financial assets investments

                       911  

Deferred tax asset

                       82,669  

Short-term investments

                       327,210  

Cash and cash equivalents (including restricted cash and cash equivalents)

                       51,558  

Income tax asset

                       26,530  

Others

                       12,197  
                    

 

 

 

Total assets

                       1,755,405  
                    

 

 

 

Liabilities

                    

Segment liabilities

     45,368       47,650       12,266       179,278       16,418       11,813       102,055       15,454       —         430,302  

Borrowings

                       579,475  

Current tax liabilities

                       1,894  

Deferred tax liabilities

                       29,675  

Others

                       32,164  
                    

 

 

 

Total liabilities

                       1,073,510  
                    

 

 

 

 

**

Other items represent forex on MAT credit entitlements which have not been allocated to any segment.

 

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c. For the six months ended September 30, 2020

 

     Copper
(
in
million)
    Zinc India
(
in
million)
    Zinc
International
(
in
million)
    Aluminium
(
in
million)
    Power
(
 in
million)
    Iron Ore
(
in
million)
    Oil and Gas
(
in
million)
    Others
(
in
million)
    Elimination
(
in
million)
    Total
(
in
million)
    Total
(US dollars
in million)
 

Revenue

                      

Sales

     42,813       93,428       10,058       124,112       28,784       14,889       30,555       20,268         364,907       4,962  

Inter-segment sales

           270         277         124       (671     —      

Segment revenue

     42,813       93,428       10,058       124,382       28,784       15,166       30,555       20,392       (671     364,907       4,962  

Cost of Sales and expenses

     (43,502     (48,762     (6,790     (94,674     (20,078     (10,576     (17,553     (17,928     671       (259,192     (3,524

Segment profit / (loss)

     (689     44,666       3,268       29,708       8,706       4,590       13,002       2,464         105,715       1,438  

Depreciation and amortisation

     (765     (11,650     (1,436     (8,353     (2,902     (1,096     (10,636     (2,602       (39,440     (536

Other items**

           950                 1,178       16  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating profit / (loss)

     (1,454     33,016       1,832       22,305       5,804       3,494       2,366       (138       67,453       918  

Investment and other income

                       15,518       211  

Finance and other costs

                       (26,224     (357
                    

 

 

   

 

 

 

Profit before tax

                       56,747       772  
                    

 

 

   

 

 

 

Assets and liabilities

                      

Assets

                      

Segment assets

     66,963       201,284       52,970       469,996       177,991       33,767       161,061       79,292         1,243,324       16,907  

Financial assets investments

                       1,321       18  

Deferred tax asset

                       61,532       837  

Short-term investments

                       277,148       3,769  

Cash and cash equivalents (including restricted cash and cash equivalents)

                       78,143       1,062  

Income tax asset

                       29,516       402  

Others

                       50,564       687  
                    

 

 

   

 

 

 

Total assets

                       1,741,548       23,681  
                    

 

 

   

 

 

 

Liabilities

                      

Segment liabilities

     44,946       38,971       8,569       146,136       17,625       10,934       99,872       14,610         381,663       5,189  

Borrowings

                       620,615       8,439  

Current tax liabilities

                       3,236       44  

Deferred tax liabilities

                       27,464       374  

Others

                       23,456       319  
                    

 

 

   

 

 

 

Total liabilities

                       1,056,434       14,365  
                    

 

 

   

 

 

 

 

**

Other items represent Renewable Power Obligation (RPO) liability reversal of  950 million ($ 13 million) and forex gain on MAT credit entitlements which has not been allocated to any segment of  228 million ($ 3 million).

 

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Disaggregation of Revenue

Below table summarises the disaggregated revenue from contracts with customers: —

For the six months ended September 30,

 

     2019      2020      2020  
     ( in
million)
     ( in
million)
     (US dollars in
million)
 

Oil

     60,401        27,430        373  

Gas

     3,380        1,874        25  

Zinc Metal

     82,356        68,410        930  

Lead Metal

     17,127        17,470        238  

Silver Metal & Bars

     11,903        18,769        255  

Iron Ore

     5,594        5,981        81  

Metallurgical Coke

     86        463        6  

Pig Iron

     11,146        10,627        145  

Copper Products

     49,812        39,804        541  

Aluminium Products

     128,432        122,644        1,668  

Power

     27,009        19,945        271  

Steel Products

     19,072        15,959        217  

Others

     9,654        8,727        119  
  

 

 

    

 

 

    

 

 

 

Revenue from contracts with customers

     425,972        358,103        4,869  

Revenue from contingent rents

     8,333        7,680        105  

Gains/ (losses) on provisionally priced contracts

     (5,246      (876      (12
  

 

 

    

 

 

    

 

 

 

Total Revenue

     429,059        364,907        4,962  
  

 

 

    

 

 

    

 

 

 

 

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Table of Contents

6. Investment and other income

 

For the six months ended September 30,    2019      2020      2020  
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Fair value gain on financial assets at fair value through profit or loss (FVTPL)

     2,538        7,790        106  

Interest income:

        

Interest income on financial assets at fair value through profit or loss

     5,372        3,047        41  

Interest income on bank deposits at amortized cost

     660        2,212        30  

Interest income on loans and receivables at amortized cost

     2,691        1,718        24  

Others

     311        334        5  

Dividend income on investments held at FVOCI

     17        17        0  

Dividend income – financial assets at fair value through profit or loss

     296        12        0  

Foreign exchange gain/ (loss) net

     2,685        388        5  
  

 

 

    

 

 

    

 

 

 
     14,570        15,518        211  
  

 

 

    

 

 

    

 

 

 

7. Finance and other costs

 

For the six months ended September 30,    2019      2020      2020  
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Interest expense on financial liabilities at amortised cost

     29,742        26,082        355  

Unwinding of discount on provisions

     461        344        5  

Net foreign exchange loss on borrowings and creditors for capital expenditure

     2,711        582        8  

Other finance costs

     1,588        1,098        15  

Net interest on defined benefit arrangements

     96        97        1  

Capitalisation of finance costs

     (5,074      (1,979      (27
  

 

 

    

 

 

    

 

 

 
     29,524        26,224        357  
  

 

 

    

 

 

    

 

 

 

 

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8. Income tax expense

The major components of income tax expense for the six months ended September 30, 2019 and 2020 are indicated below:

(a) Tax charge/ (credit) recognised in the consolidated statement of Profit or loss

 

For the six months ended September 30,    2019     2020     2020  
     ( in
million)
    ( in
million)
    (US dollars
in million)
 

Current tax:

      

Current tax on profit for the period

     9,533       8,854       120  
  

 

 

   

 

 

   

 

 

 

Total current tax (a)

     9,533       8,854       120  
  

 

 

   

 

 

   

 

 

 

Deferred tax:

      

Origination/(reversal) of temporary differences*

     (19,186     18,351       250  

(Credit) in respect of deferred tax for earlier years

     (18     —         —    
  

 

 

   

 

 

   

 

 

 

Total deferred tax charge/ (credit) (b)

     (19,204     18,351       250  
  

 

 

   

 

 

   

 

 

 

Net tax expense/(credit) ((a)+(b))

     (9,671     27,205       370  
  

 

 

   

 

 

   

 

 

 

Profit before tax

     27,101       56,747       772  

Effective income tax rate (%)

     (35.7 %)      47.9     47.9

 

*

Consequent to the declaration of dividend (including from accumulated profits) by the subsidiaries, the unabsorbed depreciation as per tax laws have been utilized by the Company leading to a deferred tax charge of  12,831 million in the half year ended September 30, 2020. Further, during the corresponding half year ended September 30, 2019, section 115BAA of the Income Tax Act was introduced and based on the expected timing of adoption of the same, the Group remeasured its deferred tax balances as at April 1, 2019 and recognised a deferred tax credit of  23,151 million in the half year ended September 30, 2019. In case the actual timing of adoption of section 115BAA is changed from what is presently estimated the deferred tax balances would be required to be remeasured.

(b)

The tax department had raised demands on account of remeasurement of certain tax incentives under section 80IA and 80 IC of the Income Tax Act. During the previous year, based on the favorable orders from Income Tax Appellate Tribunal relating to AY 09-10 to AY 12-13, the Commissioner of Income Tax (Appeals) has allowed these claims for AY 14-15 to AY 15-16, which were earlier disallowed and has granted refund of amounts deposited under protest. Against the Tribunal order, department had filed an appeal in Hon’ble Rajasthan High Court in financial year 2017-18 which is yet to be admitted. As per the view of external legal counsel, Department’s appeal seeks re-examination of facts rather than raising any substantial question of law and hence it is unlikely that appeal will be admitted by the High Court. Due to this there is a strong prima facie case that ITAT order will stand confirmed and department’s appeal would be dismissed. The amount involved in this dispute is  105,658 million and  109,000 million ($ 1,482 million) as at March 31, 2020 and September 30, 2020 respectively, plus applicable interest upto the date of settlement of the dispute.

 

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Table of Contents

9. Earnings per share (“EPS”)

The following reflects the income and share data used in the basic and diluted earnings per share computations:

Computation of weighted average number of shares

 

For the six months ended September 30,

   2019      2020  

Weighted average number of ordinary shares for basic earnings per share*

     3,702,506,169        3,703,288,875  

Effect of dilution:

     

Potential ordinary shares relating to share option awards

     16,406,412        20,486,599  
  

 

 

    

 

 

 

Adjusted weighted average number of ordinary shares for diluted earnings per share

     3,718,912,581        3,722,997,996  
  

 

 

    

 

 

 

Computation of basic and diluted earnings per share

Basic earnings per share:

 

For the six months ended September 30,    2019      2020      2020  
     ( in million
except EPS data)
     ( in million
except EPS data)
     (US dollars in
million except EPS
data)
 

Profit for the period attributable to equity holders of the parent

     25,210        16,448        224  

Weighted average number of ordinary shares for basic earnings per share*

     3,702,506,169        3,703,288,875        3,703,288,875  
  

 

 

    

 

 

    

 

 

 

Earnings per share

     6.81        4.44        0.06  
  

 

 

    

 

 

    

 

 

 

Diluted earnings per share:

 

For the six months ended September 30,    2019      2020      2020  
     ( in million
except EPS data)
     ( in million
except EPS data)
     (US dollars in
million except EPS
data)
 

Profit / (loss) for the period attributable to equity holders of the parent

     25,210        16,448        224  

Adjusted weighted average number of ordinary shares for diluted earnings per share*

     3,718,912,581        3,722,997,996        3,722,997,996  
  

 

 

    

 

 

    

 

 

 

Earnings per share

     6.78        4.42        0.06  
  

 

 

    

 

 

    

 

 

 

 

*

After excluding the impact of treasury shares

 

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Table of Contents

10. Restricted cash and cash equivalents

Restricted cash and cash equivalents consist of the following:

 

     As at,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Cash at banks1

     960        968        13  
  

 

 

    

 

 

    

 

 

 
     960        968        13  
  

 

 

    

 

 

    

 

 

 

 

1 

Cash at banks is restricted in use as it relates to unpaid dividends of  941 million and  950 million ($ 13 million) as at March 31, 2020 and September 30, 2020 respectively. It also includes earmarked escrow amount of  19 million and  18 million ($ 0 million) as at March 31, 2020 and September 30, 2020 respectively, relating to unclaimed redeemable preference shares.

11. Cash and cash equivalents

Cash and cash equivalents consist of the following:

 

     As at March 31,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Cash at banks and in hand

     23,922        18,608        253  

Short-term deposits

     26,676        58,567        796  
  

 

 

    

 

 

    

 

 

 
     50,598        77,175        1,049  
  

 

 

    

 

 

    

 

 

 

Short-term deposits are made for periods of between one day and three months, depending on the immediate cash requirements of the respective companies, and earn interest at the respective short-term deposit rates.

12. Borrowings

Current borrowings consist of:

 

     As at,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Banks and financial institutions

     112,710        96,700        1,315  

Others

     —          50        1  

Current maturities of long-term borrowings

     99,521        133,062        1,809  
  

 

 

    

 

 

    

 

 

 

Current borrowings (A)

     212,231        229,812        3,125  
  

 

 

    

 

 

    

 

 

 

 

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Table of Contents

Non-current borrowings consist of:

 

     As at March 31,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in
million)
     ( in
million)
     (US dollars
in million)
 

Banks and financial institutions

     294,233        357,885        4,867  

Non-convertible debentures

     163,874        163,189        2,219  

Redeemable preference shares

     19        18        0  

Non-convertible bonds

     1,462        1,558        21  

Others

     7,177        1,215        16  
  

 

 

    

 

 

    

 

 

 

Non-current borrowings

     466,765        523,865        7,123  

Less: Current maturities of long-term borrowings

     (99,521      (133,062      1,809  
  

 

 

    

 

 

    

 

 

 

Non-current borrowings, net of current maturities (B)

     367,244        390,803        5,314  

Debt securities issued / repaid during the period:

In September 2016, Vedanta Ltd issued NCDs of  6,000 million ($ 82 million) at an interest rate of 8.70%. These NCDs are secured by way of first ranking pari passu charge on movable fixed assets in relation to the Lanjigarh Refinery Expansion Project (having capacity beyond 2 MTPA and upto 6 MTPA) situated at Lanjigarh, Orissa. The Lanjigarh Refinery Expansion Project shall specifically exclude the 1 MTPA alumina refinery of Vedanta Limited along with 90 MW power plant in Lanjigarh and all its related capacity expansions. The NCDs have been fully repaid in April 2020.

In August 2015, Vedanta Ltd issued NCDs of  20,000 million ($ 272 million) at an interest rate of 9.45%. These NCDs are secured by way of movable fixed assets in relation to the 1.6 MTPA Aluminium Smelter alongwith 1215 MW (135MW * 9) captive power plant located in Jharsuguda and 1 MTPA Alumina Refinery alongwith 90 MW co-generation power plant located at Lanjigarh in Odisha State and shall include all present movable plant and machinery, machinery spares, tools and accessories, fixtures, mechanical and electrical equipments, machinery and all other movable fixed assets and all estate, right, title, interest, property, claims and demands whatsoever in relation to assets. The NCDs have been fully repaid in August 2020.

In August, 2017, TSPL issued NCDs of  5,000 million ($ 68 million) at an interest rate of 7.85%. These NCDs are secured by first pari passu charge on movable and/or immovable fixed assets of TSPL with a minimum asset cover of 1 times during the tenure of NCD and an unconditional and irrevocable corporate guarantee by Vedanta Limited. The NCDs have been fully repaid in August 2020.

In August 2017, BALCO had issued NCDs of  5,000 million ($ 68 million) at an interest rate of 7.94%. These were secured by first pari passu charge over the immovable property (excluding of leasehold land and coal block assets) of BALCO .The NCDs of  2,000 million have been repaid in March 2020 and balance  3,000 million were repaid in July 2020.

In May 2017, VGCB has issued NCDs of  4,250 million ($ 58 million) at an interest rate of 8.25%. These NCDs are secured by way of first pari-passu charge on the specific movable and/or immovable fixed assets, as may be identified and notified by the Issuer to the Security Trustee from time to time, with minimum asset coverage of 1 time of the aggregate face value of Bonds outstanding at any point of time. The asset cover thereof exceeds 1 time of the principal amount of the said debentures. The NCDs have been fully repaid in September 2020.

In September 2020, HZL issued NCDs of  35,200 million ($ 479 million) at an interest rate of 5.35%. These NCDs are unsecured. The NCDs are due for repayment in three yearly installments commencing from September 2021. As at September 30, 2020, the carrying value is  35,200 million ($ 479 million).

In September 2020, Ferro Alloys Corporation Limited issued zero coupon NCDs of  2,842 million ($ 39 million). These NCDs are secured by way of charge against all existing assets of the company. The NCDs are due for repayment in four annual equal installments commencing from March 2021. As at September 30, 2020, the carrying value is  2,342 million ($ 32 million) (Refer Note 4 – Business combination)

 

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Table of Contents

13. Financial instruments

A. Financial assets and liabilities:

The following tables present the carrying value and fair value of each category of financial assets and liabilities as at March 31, 2020 and September 30, 2020.

As at March 31, 2020:

 

     ( in million)  

Financial assets

   Fair value
through
profit or
loss
    Fair value
through
other
comprehensive
income
     Derivatives
designated
as hedging
instruments
     Amortised
cost
     Total
carrying
value
     Total fair
value
 

Financial assets investments

                

—at fair value

     500       411        —          —          911        911  

Other non—current assets

     —         —          —          49,384        49,384        49,384  

Trade and other receivable

     506     —          —          51,392        51,898        51,898  

Short term investments

                

—Bank deposits

     —         —          —          80,633        80,633        80,633  

—Other investments

     246,577       —          —          —          246,577        246,577  

Financial instruments (derivatives)

     2,760       —          4,187        —          6,947        6,947  

Cash and cash equivalents

     —         —             50,598        50,598        50,598  

Restricted cash and cash equivalents

     —         —          —          960        960        960  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

     250,343       411        4,187        232,967        487,908        487,908  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

*

Under IFRS 9, provisionally priced receivables are fair valued at each reporting date.

As at March 31, 2020:

 

     ( in million)  

Financial liabilities

   Fair value
through
profit or
loss
    Derivatives
designated
as hedging
instrument
     Amortised
cost
     Others*      Total
carrying
value
     Total fair
value
 

Borrowings

     —         —          579,475        —          579,475        580,521  

Acceptances

     —         —          101,851        —          101,851        101,851  

Trade and other payables

     5,170 **      —          205,445        2,472        213,087        213,087  

Financial instruments (derivatives)

     464       947           —          1,411        1,411  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

     5,634       947        886,771        2,472        895,824        896,870  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

*

Includes put option liability accounted for at fair value

**

Under IFRS 9, provisionally priced payables are fair valued at each reporting date.

 

F-28


Table of Contents

As at September 30, 2020:

 

     ( in million)      (US dollars in million)  

Financial assets

   Fair
value
through
profit or
loss
    Fair value
through
other
comprehensive
income
     Derivatives
designated
as hedging
instruments
     Amortised
cost
     Total
carrying
value
     Total fair
value
     Total
carrying
value
     Total fair
value
 

Financial assets investments

                      

—at fair value

     500       821        —          —          1,321        1,321        18        18  

Other non—current assets

     —         —          —          65,380        65,380        65,380        889        889  

Trade and other receivable

     809     —          —          88,883        89,692        89,692        1,220        1,220  

Short term investments

                      

—Bank deposits

     —         —          —          1,13,416        1,13,416        1,13,416        1,542        1,542  

—Other investments

     1,63,732       —          —          —          1,63,732        1,63,732        2,227        2,227  

Financial instruments (derivatives)

     120       —          67        —          187        187        3        3  

Cash and cash equivalents

     —         —          —          77,175        77,175        77,175        1,049        1,049  

Restricted cash and cash equivalents

     —         —          —          968        968        968        13        13  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

     1,65,161       821        67        3,45,822        5,11,871        5,11,871        6,961        6,961  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

*

Under IFRS 9, provisionally priced receivables are fair valued at each reporting date.

As at September 30, 2020:

 

     ( in million)      (US dollars in million)  

Financial liabilities

   Fair value
through
profit or
loss
    Derivatives
designated
as hedging
instrument
     Amortised
cost
     Others*      Total
carrying
value
     Total fair
value
     Total
carrying
value
     Total fair
value
 

Borrowings

     —         —          6,20,615        —          6,20,615        6,19,803        8,439        8,428  

Acceptances

     —         —          89,874        —          89,874        89,874        1,222        1,222  

Trade and other payables

     7,360 **      —          1,91,463        2,527        2,01,350        2,01,350        2,738        2,738  

Financial instruments (derivatives)

     1,892       2,823        —          —          4,715        4,715        64        64  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

     9,252       2,823        9,01,952        2,527        9,16,554        9,15,742        12,463        12,452  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

*

Includes put option liability accounted for at fair value

**

Under IFRS 9, provisionally priced payables are fair valued at each reporting date.

 

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Fair value hierarchy

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

 

 

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

 

 

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

 

 

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)

 

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The below table summarizes the categories of financial assets and liabilities as at March 31, 2020 and September 30, 2020 measured at fair value:

 

As at March 31, 2020    (Level 1)      (Level 2)      (Level 3)  
     ( in million)  

Financial assets

        

At fair value through profit or loss

        

— Investments

     75,975        170,602        500  

— Derivatives financial assets

     —          2,760        —    

— Trade and other receivables

     —          506        —    

At fair value through other comprehensive income

        

— Financial asset investments held at fair value

     304        —          107  

Derivatives designated as hedging instruments

        

— Derivatives financial assets

     —          4,187     
  

 

 

    

 

 

    

 

 

 
     76,279      178,055      607  

Financial liabilities

        

At fair value through profit or loss

        

—Derivatives financial liabilities

     —          464        —    

Trade payable

     —          5,170        —    

Derivatives designated as hedging instruments

        

—Derivatives financial liabilities

     —          947        —    

Trade and other payables- Put option liability with non controlling interest

     —          —          2,472  
  

 

 

    

 

 

    

 

 

 
     —          6,581        2,472  
  

 

 

    

 

 

    

 

 

 

 

As at September 30, 2020    (Level 1)      (Level 2)      (Level 3)      (Level 1)      (Level 2)      (Level 3)  
     ( in million)      (US dollars in million)  

Financial assets

                 

At fair value through profit or loss

                 

— Investments

     34,917        1,28,816        500        475        1,752        7  

— Derivatives financial assets

     —          120        —          —          2        —    

— Trade and other receivables

     —          809        —          —          11        —    

At fair value through other comprehensive income

                 

— Financial asset investments held at fair value

     714        —          107        10        —          1  

Derivatives designated as hedging instruments

                 

— Derivatives financial assets

        67           —          1        —    
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
     35,631        1,29,812        607        485        1,766        8  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Financial liabilities

                 

At fair value through profit or loss

                 

—Derivatives financial liabilities

     —          1,892        —          —          26        —    

Trade payable

     —          7,360        —          —          100        —    

Derivatives designated as hedging instruments

                 

—Derivatives financial liabilities

     —          2,823        —          —          38        —    

Trade and other payables- Put option liability with non controlling interest

     —          —          2,527        —          —          34  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
     —          12,075        2,527        —          164        34  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

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The below table summarizes the fair value of borrowings which are carried at amortised cost as at March 31, 2020 and September 30, 2020:

 

As at March 31, 2020    (Level 2)  
     ( in million)  

Financial Liabilities

  

—Borrowings

     580,521  
  

 

 

 
     580,521  
  

 

 

 

 

As at September 30, 2020    (Level 2)      (Level 2)  
     ( in million)      US dollars in million  

Financial Liabilities

     

—Borrowings

     6,19,803        8,428  
  

 

 

    

 

 

 
     6,19,803        8,428  
  

 

 

    

 

 

 

The fair value of the financial assets and liabilities are at the amount that would be received to sell an asset and paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate the fair values:

 

   

Investments traded in active markets are determined by reference to quotes from the financial institutions; for example: Net asset value (NAV) for investments in mutual funds declared by mutual fund house. For other listed securities traded in markets which are not active, the quoted price is used wherever the pricing mechanism is same as for other marketable securities traded in active markets. Other current investments and structured investments are valued by referring to market inputs including quotes, trades, poll, primary issuances for securities and /or underlying securities issued by the same or similar issuer for similar maturities and movement in benchmark security, etc.

 

   

Financial assets forming part of Trade and other receivables, cash and cash equivalents (including restricted cash and cash equivalents), bank deposits, financial liabilities forming part of trade and other payables, acceptances and short-term borrowings being carried at amortised cost: Approximate their carrying amounts largely due to the short-term maturities of these instruments.

 

   

Non-current fixed-rate and variable-rate borrowings: Fair value has been determined by the Group based on parameters such as interest rates, specific country risk factors, and the risk characteristics of the financed project.

 

   

Quoted financial asset investments: Fair value is derived from quoted market prices in active markets.

 

   

Unquoted financial asset investments: Fair value of unquoted securities are determined by reference to discounted cash flows model.

 

   

Derivative financial assets/liabilities: The Group enters into derivative financial instruments with various counterparties. Interest rate swaps, foreign exchange forward contracts and commodity forward contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques by the Group include forward pricing and swap models, using present value calculations. The models incorporate various inputs including the foreign exchange spot and forward rates, yield curves of the respective currencies, currency basis spreads between the respective currencies, interest rate curves and forward rate curves of the underlying commodity. Commodity contracts are valued using the forward LME rates of commodities actively traded on the listed metal exchange i.e. London Metal Exchange, United Kingdom (UK).

 

   

Other non-current financial assets and financial liabilities: Fair value is calculated using a discounted cash flow model with market assumptions, unless the carrying value is considered to approximate to fair value.

For all other financial instruments, the carrying amount is either the fair value, or approximates the fair value.

The changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationship and the value of other financial instruments recognised at fair value.

The estimated fair value amounts as at March 31, 2020 and September 30, 2020 have been measured as at that date. As such, the fair values of these financial instruments subsequent to reporting date may be different than the amounts reported at each period-end.

There were no significant transfers between level 1, level 2 and level 3 during the current period.

 

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14. Shareholders’ equity

 

     As at
March 31, 2020
(in Million)
     As at
March 31, 2020
(
Million)
     As at
September 30,
2020
(in Million)
     As at
September 30,
2020
(
Million)
     As at
September 30,
2020
(US dollars
in million)
 

Authorised Share Capital:

              

Opening and closing balance (equity shares of 1 each with voting rights) a

     44,020        44,020        44,020        44,020        599  

Authorised preference share capital:

              

Opening and closing balance (preference shares of 10 each)

     3,010        30,100        3,010        30,100        409  

Issued , subscribed and paid up

              

Equity shares of 1 each with voting right a,b,c,d

     3,718        3,718        3,718        3,718        51  

 

a)

The Company has one class of equity shares having a par value of  1 per share. Each shareholder is eligible for one vote per share held and dividend as and when declared by the Company.

 

b)

This includes 261,780,208 equity shares in form of 65,445,052 ADS and 156,496,036 equity shares in the form of 39,124,009 ADS as at March 31, 2020 and September 30, 2020, respectively.

 

c)

Includes 308,232 equity shares as at March 31, 2020 and 308,232 equity shares as at September 30, 2020 kept in abeyance. These shares are not part of listed equity capital and pending allotment as they are sub-judice.

 

d)

Includes 14,378,261 equity shares as at March 31, 2020 and 13,392,506 equity shares as at September 30, 2020 held by Vedanta Limited ESOS Trust.

Securities premium

Securities premium is created to record amounts received in excess of the par value of shares in separate account as required by the Indian Companies Act. The securities premium account may be applied by the company towards the issue of unissued shares of the company to the members of the company as fully paid bonus shares, writing off the preliminary expenses of the company, writing off the expenses of, or the commission paid or discount allowed on any issue of shares or debentures of the company, providing for the premium payable on the redemption of any redeemable preference shares or of any debentures of the company; or for the purchase of its own shares or other securities.

Retained earnings includes amongst others, general reserve, debenture redemption reserve, capital reserve and preference share redemption reserve.

General reserve

Under the erstwhile Indian Companies Act 1956, a general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10.0% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatory transfer a specified percentage of the net profit to general reserve has been withdrawn. The balances in general reserves, as determined in accordance with applicable regulations, was  160,950 million and  160,950 million ($ 2,189 million) as at March 31, 2020 and September 30, 2020 respectively.

 

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Debenture redemption reserve

As per the earlier provision under the Indian Companies Act, companies that issue debentures were required to create debenture redemption reserve from annual profits until such debentures are redeemed. Companies are required to maintain 25% as a reserve of outstanding redeemable debentures. The amounts credited to the debenture redemption reserve may not be utilized except to redeem debentures. The MCA vide its Notification dated August 16, 2019, had amended the Companies (Share Capital and Debenture) Rules, 2014, wherein the requirement of creation of Debenture Redemption Reserve has been exempted for certain class of companies, hence, in view of the same, Vedanta Limited is not required to create Debenture Redemption Reserve. Retained earnings include  11,115 million and  5,831 million ($ 79 million) of debenture redemption reserve as at March 31, 2020 and September 30, 2020 respectively.

Preference share redemption reserve

The Indian Companies Act provides that companies that issue preference shares may redeem those shares from profits of the Company which otherwise would be available for dividends, or from proceeds of a new issue of shares made for the purpose of redemption of the preference shares. If there is a premium payable on redemption, the premium must be provided, either by reducing the additional paid in capital (securities premium account) or out of profits, before the shares are redeemed.

If profits are used to redeem preference shares, the value of the nominal amount of shares redeemed should be transferred from profits (retained earnings) to the preference share redemption reserve account. This amount should then be utilised for the purpose of redemption of redeemable preference shares. This reserve can be used to issue fully paid-up bonus shares to the shareholders of Vedanta Limited. Retained earnings include  30,869 million and  30,869 million ($ 420 million) of preference share redemption reserve as at March 31, 2020 and September 30, 2020 respectively.

Capital reserve

The balance in capital reserve as at March 31, 2020 and September 30, 2020 is  184,328 million and  183,347 million ($ 2,493 million) respectively. The balance in capital reserve has mainly arisen pursuant to extinguishment of non-controlling interests of erstwhile Cairn India Limited and acquisition of ASI. Further, changes in capital reserve are due to recognition/derecognition of put option liability and non-controlling interests pertaining to ASI.

 

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15. Commitments, contingencies, and guarantees

In the normal course of business, the Group enters into certain capital commitments and also gives certain financial guarantees.

A. Capital commitments

The Group has a number of continuing operational and financial commitments in the normal course of business including:

 

   

Exploratory mining commitments;

 

   

Oil & gas commitments;

 

   

Mining commitments arising under production sharing agreements; and

 

   

Completion of the construction of certain assets.

Estimated amount of contracts remaining to be executed on capital accounts and not provided for:

 

     As at,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in million)      ( in million)      (US dollars
in million)
 

Oil & Gas sector

        

Cairn India

     31,464        19,428        258  
  

 

 

    

 

 

    

 

 

 

Aluminium sector

        

Lanjigarh Refinery (Phase II)

     15,728        15,709        208  

Jharsuguda 1.25 MTPA smelter

     4,140        4,080        54  
  

 

 

    

 

 

    

 

 

 

Zinc sector

        

Zinc India (mines expansion, solar and smelter)

     9,123        6,302        84  

Gamsberg mining & milling project

     1,306        851        11  
  

 

 

    

 

 

    

 

 

 

Copper sector

        

Tuticorin Smelter 400 KTPA*

     27,913        30,037        398  
  

 

 

    

 

 

    

 

 

 

Others

     16,112        13,060        173  
  

 

 

    

 

 

    

 

 

 

Total

     105,786        89,467        1,186  
  

 

 

    

 

 

    

 

 

 

 

*

currently contracts are under suspension under the force majeure clause as per the contract

Committed work programme (Other than capital commitment):

 

     As at,  
     March 31,
2020
     September 30,
2020
     September 30,
2020
 
     ( in million)      ( in million)      (US dollars
in million)
 

Oil & Gas sector

        

Cairn India (OALP - New Oil and Gas blocks)

     58,409        56,736        753  
  

 

 

    

 

 

    

 

 

 

 

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Other Commitments

 

  (i)

Power Division of the Company has signed a long term power purchase agreement (PPA) with Gridco Limited for supply of 25% of power generated from the power station with additional right to purchase power at (5%/7%) at variable cost as per the conditions referred to in PPA.The PPA has a tenure of twenty five years.

 

  (ii)

TSPL has signed a long term power purchase agreement (PPA) with Punjab State Power Corporation Limited (PSPCL) [formerly known as Punjab State Electricity Board (PSEB)] for supply of power generated from the power plant. The PPA has tenure of twenty five years.

B. Guarantees

The aggregate amount of indemnities and other guarantees on which the Group does not expect any material losses, was  64,878 million and  94,739 million ($ 1,288 million) as at March 31, 2020 and September 30, 2020 respectively.

The Group has given guarantees in the normal course of business as stated below:

 

   

Guarantees and bonds advanced to the customs authorities in India of  4,713 million and  4,364 million ($ 59 million) as at March 31, 2020 and September 30, 2020 respectively relating to the export and payment of import duties on purchases of raw material and capital goods.

 

   

Guarantees issued for Group’s share of minimum work programme commitments of  29,059 million and  29,005 million ($ 394 million) as at March 31, 2020 and September 30, 2020 respectively.

 

   

Guarantees of  537 million and  147 million ($ 2 million) issued under bid bond for placing bids as at March 31, 2020 and September 30, 2020 respectively.

 

   

The Group’s overseas subsidiaries have given guarantees to Vedanta Resources Limited (VRL) and its subsidiaries majorly in respect of certain short term borrowings amounting to Nil and  31,257 million ($ 425 million) as at March 31, 2020 and September 30, 2020 respectively. Subsequent to the balance sheet date, these guarantees have been extinguished. Refer Note 17.

 

   

Bank guarantees of  1,150 million ($ 16 million) outstanding as at September 30, 2020 has been provided by the Group on behalf of Volcan Investments Limited to Income tax department, India as a collateral in respect of certain tax disputes.

 

   

Other guarantees of  29,419 million and  28,816 million ($ 392 million) as at March 31, 2020 and September 30, 2020 respectively issued for securing supplies of materials and services, in lieu of advances received from customers, litigation, for provisional valuation of custom duty and also to various agencies, suppliers and government authorities for various purposes. The Group does not anticipate any liability on these guarantees.

C. Export Obligations

The Indian entities of the Group have export obligations of  38,269 million and  34,381 million ($ 468 million) as at March 31, 2020 and September 30, 2020 respectively on account of concessional rates of import duty paid on capital goods under the Export Promotion Capital Goods Scheme and under the Advance License Scheme for the import of raw material laid down by the Government of India.

In the event of the Group’s inability to meet its obligations, the Group’s liability would be  6,072 million and  5,368 million ($ 73 million) as at March 31, 2020 and September 30, 2020 respectively, plus applicable interest.

The Group has given bonds of  16,950 million and  17,587 million ($ 223 million) as at March 31, 2020 and September 30, 2020 respectively to custom authorities against these export obligations.

 

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D. Contingencies

The Group discloses the following legal and tax cases as contingent liabilities.

Hindustan Zinc Limited: Department of Mines and Geology

The Department of Mines and Geology of the State of Rajasthan issued several show cause notices to HZL in August, September and October 2006, aggregating  3,339 million ($ 45 million) as at March 31, 2020 and September 30, 2020 claiming unlawful occupation and unauthorised mining of associated minerals other than zinc and lead at HZL’s Rampura Agucha, Rajpura Dariba and Zawar mines in Rajasthan during the period from July 1968 to March 2006. In response, HZL filed a writ petition against these show cause notices before the High Court of Rajasthan in Jodhpur. In October 2006, the High Court issued an order granting a stay and restrained the Department of Mines and Geology from undertaking any coercive measures to recover the penalty. In January 2007, the High Court issued another order granting the Department of Mines and Geology additional time to file their reply and also ordered the Department of Mines and Geology not to issue any orders cancelling the lease. The State Government filed for an early hearing application in the High Court. The High Court has passed an order rejecting the application stating that Central Government should file their replies. HZL believes it is unlikely that the claim will lead to a future obligation and thus no provision has been made in the financial statements.

Vedanta Limited: Income tax

In March 2014, Vedanta Limited (notice was served on Cairn India Limited which subsequently merged with Vedanta Limited, accordingly now referred to as Vedanta Limited) received a show cause notice from the Indian Tax Authorities (‘Tax Authorities’) for not deducting withholding tax on the payments made to Cairn UK Holdings Limited (CUHL), for acquiring shares of Cairn India Holdings Limited (CIHL), as part of their internal reorganisation. The Tax Authorities have stated in the notice that a short-term capital gain has accrued to CUHL on transfer of the shares of CIHL to Vedanta Limited, in the financial year 2006–2007, on which tax should have been withheld by the Company. Pursuant to this, various replies were filed with the Tax Authorities. After several hearings, the Income Tax Authority, in March 2015, issued an order holding the Company as ‘assessee in default’ and raised a demand totalling  204,947 million ($ 2,787 million) (including interest of  102,473 million ($ 1,393 million)). The Company had filed an appeal before the First Appellate Authority, Commissioner of Income Tax (Appeals) which vide order dated July 03, 2017 confirmed the tax demand against the Company. The Company has challenged the Commissioner of Income Tax’s (Appeals) order before the Income Tax Appellate Tribunal (ITAT).

The Company also filed a writ petition before the Delhi High Court wherein it has raised several points for assailing the aforementioned Income Tax Authority’s order.

The matter came up for hearing on February 05, 2020 before Delhi High Court but adjourned and the next date of hearing is February 03, 2021.

Separately CUHL, on whom the primary liability of tax lies, had received an Order from the ITAT in the financial year 2016-17 holding that the transaction is taxable in view of the clarification made in the Act but also acknowledged that being a retrospective transaction, interest would not be levied. Hence affirming a demand of  102,473 million ($ 1,393 million) excluding the interest portion that had previously been claimed. The tax department has appealed this order before the Delhi High Court. As a result of the above order from ITAT, the Group considers the risk in respect of the interest portion of claim to be remote. Further, as per the recent recovery notice dated October 12, 2018 received from the Tax Recovery Officer (TRO) appointed for CUHL, tax demand of CUHL of approx.  49,960 million ($ 679 million) along with interest is outstanding. Further, in the said notice, tax department had also instructed to remit the preference shares redemption amount including dividend payable thereon to the TRO. Accordingly, amount aggregating to  6,070 million ($ 83 million) has been paid to the TRO on October 26, 2018 thus reducing the liability to  43,890 million ($ 597 million). Vedanta has also paid interim dividend of  50 million ($ 1 million) to the TRO. Accordingly, the Group has revised the contingent liability to  43,840 million and  43,840 million ($ 596 million) as at March 31, 2020 and September 30, 2020 respectively.

 

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In the event, the case is finally decided against the Company, the demand payable along with interest as per the above mentioned order would be  204,947 million ($ 2,787 million), of which only  43,840 million ($ 596 million) is considered as possible. Separately, but in connection with this litigation, Vedanta Resources Limited has filed a Notice of Claim against the Government of India (‘GOI’) under the UK India Bilateral Investment Treaty (the BIT). The International Arbitration Tribunal passed a favourable order on jurisdiction and Transparency and hearing on merits have been completed in May 2019 and order will be passed in due course. The Government of India has challenged the jurisdiction and Transparency orders of Arbitration Tribunal before the High Court of Singapore. The Singapore High court heard the Transparency matter on February 24, 2020 and passed favorable order and held that it will take up the Jurisdiction issue after receiving Tribunal’s award on merits. GOI has appealed the above High Court order before Singapore Supreme Court.

Ravva Joint Venture arbitration proceedings

ONGC Carry

The Ravva Production Sharing Contract (PSC) obliges the contractor parties to pay a proportionate share of ONGC’s exploration, development, production and contract costs in consideration for ONGC’s payment of costs related to the construction and other activities it conducted in Ravva prior to the effective date of the Ravva PSC (the ONGC Carry). The question as to how the ONGC Carry is to be recovered and calculated, along with other issues, was submitted to an International Arbitration Tribunal in August 2002 which rendered a decision on the ONGC Carry in favour of the contractor parties (including Vedanta Limited (Cairn India Limited which subsequently merged with Vedanta Limited, accordingly now referred to as Vedanta Limited)) whereas four other issues were decided in favour of Government of India (GOI) in October 2004 (Partial Award). The GOI then proceeded to challenge the ONGC Carry decision before the Malaysian courts, as Kuala Lumpur was the seat of the arbitration. The Federal Court of Malaysia upheld the Partial Award. As the Partial Award did not quantify the sums, therefore, contractor parties approached the same Arbitration Tribunal to pass a Final Award in the subject matter since it had retained the jurisdiction to do so. The Arbitral Tribunal was reconstituted and the Final Award was passed in October 2016 in Vedanta Limited’s favour. GOI’s challenge of the Final Award has been dismissed by the Malaysian High Court and the next appellate court in Malaysia i.e. Malaysian Court of Appeal. GOI then filed an appeal at Federal Court of Malaysia. The matter was heard on February 28, 2019 and the Federal Court dismissed GOI’s leave to appeal. The Company has also filed for the enforcement of the Partial Award and Final Award before the Hon’ble Delhi High Court. The matter has been listed for hearing on January 12, 2021.

Base Development Cost

Ravva joint operations had received a claim from the Ministry of Petroleum and Natural Gas, Government of India (GOI) for the period from 2000-2005 for  8,922 million ($ 129 million) for an alleged underpayment of profit petroleum (by recovering higher Base Development Costs (“BDC”) against the cap imposed in the PSC) to the Government of India (GOI), out of which, Vedanta Limited’s (Cairn India Limited which subsequently merged with Vedanta Limited, accordingly now referred to as Vedanta Limited) share will be  2,170 million ($ 29 million) plus interest. Joint venture partners initiated the arbitration proceedings and Arbitration Tribunal published the Award in January 2011 allowing claimants (including Vedanta Limited) to recover the development costs spent to the tune of  20,797 million ($ 276 million) and disallowed over run of  1,646 million ($ 22 million) spent in respect of BDC along with 50% legal costs.

The Company filed for the enforcement of the said Award before the Hon’ble Delhi High Court. The Hon’ble Court vide its order dated February 19, 2020 allowed the petition for enforcement of the arbitration award against which the GOI filed an SLP before the Hon’ble Supreme Court of India. The Hon’ble Court on September 16, 2020 pronounced the order in favour of Vedanta, rejecting all objections of the GOI and allowed enforcement of the Arbitration Award. With the Supreme Court order the Ravva BDC Matter stands closed.

In connection with the above two matters, the Company has received an order dated October 22, 2018 from the GOI directing oil marketing companies (OMCs) who are the offtakers of Ravva Crude to divert the sale proceeds to Government’s account. Against an interim application, filed by Vedanta Limited along with one of its joint venture partner, seeking stay of such action from GOI, before the Delhi High Court, where enforcement petitions for both matters were then pending, the Court directed the OMCs to deposit above sums to the Delhi High Court for both BDC and ONGC Carry matters. However, Vedanta Limited (and other joint venture partner) has been given the liberty to seek withdrawal of the amounts from the Court upon furnishing a bank guarantee of commensurate value. On the basis of the above direction, the customers have deposited  6,885 million ($ 94 million) out of which  6,207 million ($ 84 million) has been withdrawn post submission of BG.

The Hon’ble Delhi High Court vide its order dated May 28, 2020 read with order dated June 4, 2020 has directed that all future sale proceeds of Ravva Crude w.e.f. June 5, 2020 be paid directly to Vedanta Limited by the OMCs. In view of the closure of the BDC matter, the Company has also filed an application in HC on September 22, 2020 seeking refund of remaining  678 million (US$ 9 million) and release of Bank guarantees submitted in Court pertaining to the BDC matter.

 

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During the proceedings of the above matter, the GOI has also filed an interim application seeking deposit by the said OMCs of an amount of  6,509 million ($ 86 million) (Vedanta’s share of  4,189 million ($ 56 million) towards interest on the alleged short payment of profit petroleum by the petitioners i.e. Vedanta Limited (and other joint venture partner)

The matter has been listed for hearing on January 12, 2021 along with ONGC carry case. While the Company does not believe the GOI will be successful in its challenge, if the Arbitral Awards in above matter is reversed and such reversal is binding, the Company would be liable for approximately  6,958 million plus interest and  4,712 million ($ 64 million) plus interest as at March 31, 2020 and September 30, 2020 respectively.

Proceedings related to the Imposition of Entry Tax

Vedanta Limited and other Group companies i.e. Bharat Aluminium Company Limited (BALCO) and Hindustan Zinc Limited (HZL) challenged the constitutional validity of the local statutes and related notifications in the states of Chhattisgarh, Odisha and Rajasthan pertaining to the levy of entry tax on the entry of goods brought into the respective states from outside.

Post some contradictory orders of High Courts across India adjudicating on similar challenges, the Supreme Court referred the matters to a nine judge bench. Post a detailed hearing, although the bench rejected the compensatory nature of tax as a ground of challenge, it maintained status quo with respect to all other issues which have been left open for adjudication by regular benches hearing the matters.

Following the order of the nine judge bench, the regular bench of the Supreme Court proceeded with hearing the matters. The regular bench remanded the entry tax matters relating to the issue of discrimination against domestic goods bought from other States to the respective High Courts for final determination but retained the issue of jurisdiction for levy on imported goods, for determination by the regular bench of the Supreme Court. Following the order of the Supreme Court, the Group filed writ petitions in respective High Courts.

On October 09, 2017, the Supreme Court has held that states have the jurisdiction to levy entry tax on imported goods. With this Supreme Court judgment, imported goods will rank pari passu with domestic goods for the purpose of levy of Entry tax. Vedanta Limited and its subsidiaries have amended their appeals (writ petitions) in Odisha and Chhattisgarh to include imported goods as well. With respect to Rajasthan, the State Government has filed a counter petition in the Rajasthan High Court, whereby it has admitted that it does not intend to levy the entry tax on imported goods.

The issue pertaining to the levy of entry tax on the movement of goods into a Special Economic Zone (SEZ) remains pending before the Odisha High Court. The Group has challenged the levy of entry tax on any movement of goods into SEZ based on the definition of ‘local area’ under the Odisha Entry Tax Act which is very clear and does not include a SEZ. In addition, the Government of Odisha further through its SEZ Policy 2015 and the operational guidelines for administration of this policy dated August 22, 2016, exempted the entry tax levy on SEZ operations.

The total claims against Vedanta Limited and its subsidiaries are  13,664 million and  13,894 million ($ 189 million) net of provisions made as at March 31, 2020 and September 30, 2020 respectively.

BALCO: Challenge against imposition of Energy Development Cess

BALCO challenged the imposition of Energy Development Cess levied on generators and distributors of electrical energy at the rate of 10 paise per unit on the electrical energy sold or supplied before the High Court on the grounds that the cess is effectively on production and not on consumption or sale since the figures of consumption are not taken into account and the cess is discriminatory since captive power plants are required to pay at the rate of 10 paise while the State Electricity Board is required to pay at the rate of 5 paise. The High Court of Chhattisgarh by its order dated December 15, 2006 declared the provisions imposing ED Cess on CPPs as discriminatory and therefore ultra vires the Constitution. BALCO sought a refund of the cess amounting to  345 million ($ 5 million) it had already paid till March 2006 under protest.

The State of Chhattisgarh filed a Special Leave Petition before the Supreme Court and the SC whilst issuing notice has stayed the refund of the Cess already deposited and the Supreme Court has also directed the State of Chhattisgarh to raise the bills but no coercive action be taken for recovery of the same. In case the Supreme Court overturns the decision of the High Court, Balco would, in addition to above, would be liable to pay  8,407 million and  8,842 million ($ 120 million) as at March 31, 2020 and March 31, 2020 respectively. Accordingly, the total liability on the Group would be  8,752 million and  9,188 million ($ 125 million) as at March 31, 2020 and September 30, 2020 respectively.

 

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Miscellaneous disputes- Income tax

The Group is involved in various tax disputes amounting to  19,093 million and  19,097 million ($ 260 million) as at March 31, 2020 and September 30, 2020 respectively relating to income tax. It also includes similar matters where initial assessment is pending for subsequent periods and where the Group has made claims and assessments are in progress. These mainly relate to the disallowance of tax holiday for 100% Export Oriented Undertaking under section 10B of the Income Tax Act, 1961, disallowance of tax holiday benefit on production of gas under section 80IB of the Income Tax Act, 1961, on account of depreciation disallowances under the Income Tax Act and interest thereon which are pending at various appellate levels. Interest and penalty, if any would be additional. Refer note 8(b) for other income tax disputes.

The Group believes that these disallowances are not tenable and accordingly no provision is considered necessary.

Miscellaneous other disputes

The Group is subject to various claims and exposures which arise in the ordinary course of conducting and financing its business from the excise, indirect tax authorities and others. These claims and exposures mostly relate to the assessable values of sales and purchases or to incomplete documentation supporting the companies’ returns or other claims.

The approximate value of claims (excluding the items as set out separately above) against the Group companies total  39,960 million and  39,044 million ($ 531 million) as at March 31, 2020 and September 30, 2020 respectively.

The Group considers that it can take steps such that the risks can be mitigated and that there will no significant unprovided liabilities arising.

Except as described above, there are no pending litigations which the Group believes could reasonably be expected to have a material adverse effect on the results of operations, cash flows or the financial position of the Group.

16. Other matters

(a) i. Call option — HZL

Pursuant to the Government of India’s policy of disinvestment, the Company in April 2002 acquired 26% equity interest in Hindustan Zinc Limited (HZL) from the Government of India. Under the terms of the Shareholder’s Agreement (‘SHA’), the Company had two call options to purchase all of the Government of India’s shares in HZL at fair market value. The Group also acquired an additional 20% of the equity capital in HZL through an open offer. The Group exercised the first call option on August 29, 2003 and acquired an additional 18.9% of HZL’s issued share capital, increasing its shareholding to 64.9%. The second call option provides the Company the right to acquire the Government of India’s remaining 29.5% share in HZL. This call option was subject to the right of the Government of India to sell 3.5% of HZL shares to HZL employees. The Company exercised the second call option on July 21, 2009. The Government of India disputed the validity of the call option and refused to act upon the second call option. Consequently, the Company invoked arbitration which is in the early stages. The next date of hearing is to be notified. The Government of India without prejudice to the position on the Put / Call option issue has received approval from the Cabinet for divestment and the Government is looking to divest through the auction route. Meanwhile, the Supreme Court has, in January 2016, directed status quo pertaining to disinvestment of Government of India’s residual shareholding while hearing the public interest petition filed. Vedanta Limited has filed an early hearing application in Supreme Court. The hearings in the matter have started and will now be listed for further arguments in due course. On August 13, 2020, the Supreme Court passed an order removing the status quo order in place and has allowed the arbitration proceedings to continue. The matter will now be heard in due course.

ii. Call option — BALCO

Pursuant to the Government of India’s policy of divestment, the Company in March 2001 acquired 51% equity interest in BALCO from the Government of India. Under the terms of the SHA, the Company had a call option to purchase the Government of India’s remaining ownership interest in BALCO at any point from March 02, 2004. The Company exercised this option on March 19, 2004. However, the Government of India contested the valuation and validity of the option and contended that the clauses of the SHA violate the erstwhile Companies Act, 1956 by restricting the rights of the Government of India to transfer its shares and that as a result such provisions of the SHA were null and void. In the arbitration filed by the Company, the arbitral tribunal by a majority award rejected the claims of the Company on the ground that the clauses relating to the call option, the right of first refusal, the “tag along” rights and the restriction on the transfer of shares violate the erstwhile Companies Act, 1956 and are not enforceable.

 

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The Company has challenged the validity of the majority award before the Hon’ble High Court at Delhi and sought for setting aside the arbitration award to the extent that it holds these clauses ineffective and inoperative. The Government of India also filed an application before the High Court to partially set aside the arbitral award in respect of certain matters involving valuation. The matter will be listed for hearing in due course. Meanwhile, the Government of India without prejudice to its position on the Put / Call option issue has received approval from the Cabinet for divestment and the Government is looking to divest through the auction route.

In view of the lack of resolution on the options, the non-response to the exercise and valuation request from the Government of India, the resultant uncertainty surrounding the potential transaction and the valuation of the consideration payable, the Company considers the strike price of the options to be at the fair value, which is effectively nil, and hence the call options have not been recognised in the financial statements.

(b) The Company continues to recognise bauxite purchased under long term linkage arrangement with Orissa Mining Corporation Ltd (OMC) at provisional prices (based on last successful e-auction at Rs 673/MT) pending conduct of e-auction by OMC for discovery of prices of bauxite supplied after September 2019 with undertakings to pay the differential price that may be determined based on the next successful e-auction of bauxite. OMC conducted e-auction on August 31, 2020 with floor price of Rs 1,707/MT determined on the basis of Rule 45 of Minerals Concession Rules, 2016 (the Rules). There was no bidder at that floor price. However, OMC raised demand of  2,810 million ($ 38 million) on the Company towards differential pricing and interest for bauxite supplied after the aforesaid date.

The Company had filed a writ petition before Hon’ble High Court of Orissa in September 2020 for resumption of bauxite supplied in accordance with applicable Government of Odisha Gazette notification dated February 24, 2018. Hon’ble High Court has issued interim Order dated October 8, 2020 directing that the petitioner shall be permitted to lift the quantity of bauxite mutually agreed under the terms of the long term linkage arrangement for the remaining period of the financial year 2020-21 on payment of Rs 1,000/MT and furnishing an undertaking for the differential amount with the floor price arrived at by OMC under the Rules, subject to final outcome of the petition which is pending.

Supported by legal opinions obtained, management believes that the provisions of the Rules are not applicable to sale of bauxite under long term linkage arrangement and, hence, it is not probable that the Company will have any material obligation towards the aforesaid commitments.

(c) As at September 30, 2020, the Company and its subsidiaries have an outstanding receivable equivalent to  4,290 million ($ 60 million) (net of provision of  2,090 million ($ 28 million)) from Konkola Copper Mines Plc (KCM), a company whose majority shares are held by Vedanta Resources Limited through its subsidiary (VRL Group), predominantly regarding monies advanced against future purchase of copper cathode/anode. A provisional liquidator has been managing KCM’s affairs since May 2019, whose appointment and the liquidation proceedings have been challenged by VRL. The Group, based on its assessment considering the actions taken by VRL Group, believes that there is a high probability of success and does not expect any material adjustment to the net carrying amount of the receivables.

(d) Government of India (GoI) vide Office Memorandum (“OM”) No. O-19025/10/2005-ONG-DV dated February 01, 2013 allowed for Exploration in the Mining Lease Area after expiry of Exploration period and prescribed the mechanism for recovery of such Exploration Cost incurred. Vide another Memorandum dated October 24, 2019, GoI clarified that all approved Exploration costs incurred on Exploration activities, both successful and unsuccessful, are recoverable in the manner as prescribed in the OM and as per the provisions of PSC. Accordingly, during the previous year, the Group recognized revenue of  12,755 million ($ 174 million), for past exploration costs, through increased share in the joint operations revenue as the Group believes that cost recovery mechanism prescribed under OM for profit petroleum payable to GOI is not applicable to its Joint operation partner, view which is also supported by an independent legal opinion. However, the Joint operation partner carries a different understanding and the matter is pending resolution.

(e) In July 2017, the Appellate Tribunal for Electricity dismissed the appeal filed by one of the Group’s subsidiaries, Talwandi Sabo Power Limited (TSPL) with respect to the interpretation of how the calorific value of coal and costs associated with it should be determined. However, APTEL had allowed payment of shunting and unloading charges. TSPL filed an appeal before the Honourable Supreme Court (SC), which by an order dated March 07, 2018 has decided the matter in favour of TSPL. PSPCL has not paid the due amount as per the direction of the Supreme court. Therefore, TSPL filed its contempt petition before the SC. On August 07, 2019, SC passed order in the contempt petition in favour of TSPL and ordered PSPCL to pay the due amount in 8 weeks. PSPCL paid  10,021 million during the previous year. PSPCL filed an application in Supreme Court on October 10, 2019 seeking direction to designate an appropriate authority for arriving at the final amount as per its order. On November 25, 2019 the application had been dismissed and SC directed PSPCL to pay the remaining amount within 12 weeks (i.e. by February 17, 2020). On February 13, 2020, PSPCL filed a miscellaneous application seeking additional time for compliance of order dated November 25, 2019. TSPL also filed a second contempt petition on November 13, 2019 in Supreme Court regarding the remaining amount receivable from PSCPL. PSPCL filed counter affidavit in reply to the second contempt petition. TSPL filed rejoinder to the counter affidavit on February 24, 2020 and the next date of hearing is awaited. The outstanding dues (included in trade receivables) as at March 31, 2020 and September 30, 2020 is  2,472 million and  3,100 million respectively and interest receivable in relation to this dispute as at March 31, 2020 and September 30, 2020 is  1,399 million and  1,399 million respectively.

 

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In another matter relating to assessment of whether there has been a change in law following the execution of the Power Purchase Agreement, the Appellate Tribunal for Electricity has dismissed the appeal in July 2017 filed by TSPL. TSPL filed an appeal before the Honourable Supreme Court to seek relief which is yet to be listed. The outstanding trade receivables in relation to this dispute and other matters is  12,978 million as at March 31, 2020 and  13,765 million ($ 187 million) as at September 30, 2020. The Group, based on external legal opinion and its own assessment of the merits of the case, remains confident that it is highly probable that the Supreme court will uphold TSPL’s appeal and has thus continued to treat these balances as recoverable.

(f) As at September 30, 2020, trade receivables amounting to  14,776 million ($ 201 million) are overdue and it includes  4,445 million ($ 59 million) outstanding on account of certain disputes raised by the customer relating to computation of power tariffs pending adjudication by Appellate Tribunal For Electricity (APTEL).

The customer has also raised certain claims on the Company in respect of short supply of power for which a provision of  2,177 million ($ 30 million) has been made in the books of account. Various Minutes of Meetings (MOMs) were signed with the customer for computing the short supply claims, which were subject to approval of Odisha Electricity Regulatory Commission (OERC). On June 22, 2020 OERC pronounced its order on computation methodology for short supply claims, basis which both the parties have to recompute the amount of claim and settle the matter in two months from the date of the order. On initial impact assessment of the said order by the Company, it believes that no further provisioning is required in this regard.

The Company has filed an appeal on August 24, 2020 before APTEL against said OERC Order which will be listed for hearing on January 19, 2021. GRIDCO has also sought review of said OERC Order, which was heard by OERC on November 3, 2020 and the Company has been directed to file its reply. The matter is posted for hearing by OERC on December 22, 2020.

Pending finalization of above short supply claims and adjudication on power tariff computation by APTEL, the customer has withheld  14,776 million ($ 201 million), which the Company is confident of recovering fully.

(g) Pursuant to Management Committee recommendation and minutes of Empowered Committee of Secretaries (ECS) filed by GoI, Vedanta Limited had considered cost recovery of  16,176 million ($ 251 million) in FY 2017-18, being the cost incurred over the initially approved FDP of Pipeline Project. Vedanta Limited’s claim for the resultant profit petroleum of  3,219 million ($ 43 million), which had been previously paid, has been objected by the GoI. This advance profit petroleum has been fully adjusted against the profit petroleum payable in June 2020.

(h) In terms of various notifications issued by the Ministry of Environment, Forest and Climate Change (MoEF&CC), ash produced from thermal power plant are required to be disposed of by the Group in the manner specified in those notifications. However, compliance with manner of disposal as specified in those notifications is not achieved due to lack of demand from user agencies side. Consequently, the Group is storing ash produced in ash dyke in accordance with conditions of the Environmental Clearance & Consent to Operate granted by the MOEF&CC,Office of State Pollution Control Board (OSPCB) & Chhattisgarh Environment Conservation Board (CECB) respectively as well as supplying the same to user agencies. Management believes storage of ash in ash dykes/ ash pond in accordance with environmental clearances received by the Group are enough compliance with the applicable notifications issued by MoEF&CC which is supported by a legal opinion obtained.

The National Green Tribunal (NGT) has also taken cognizance of the matter and vide its order dated February 12, 2020 has ordered for levy of environmental compensation on generating companies on account of their failure to comply the aforesaid notifications. The Group has filed SLPs before the Hon’ble Supreme Court challenging the order dated February 12, 2020 of the NGT and the same was heard by the Court on September 11, 2020 and granted an ad interim stay against recoveries in pursuance of NGT order. Management believes that the outcome of the appeal will not have any significant adverse financial impact on the Group which is supported by a legal opinion obtained.

(i) The Department of Mines and Geology (DMG) of the State of Rajasthan initiated the royalty assessment process from Jan 2008 to 2019 and issued a show cause notice vide an office order dated January 31, 2020 amounting to  19,250 million ($ 262 million). The Group has challenged (the show cause notice or / and) computation mechanism of the royalty on the ground that the State has not complied with the previous orders of Rajasthan High Court where a similar computation mechanism was challenged and Court had directed DMG to reassess basis the judicial precedents and mining concession rules. Pending compliance of previous orders, High Court has granted a stay on the notice and directed DMG not to take any coercive action. State has filed an affidavit commenting on the representation submitted by Group and has sought for an early hearing. Since the State has failed to examine all the points raised by Group, Group will seek a direction to decide on all the points. Based on the opinion of external council, the Group believes that it has strong grounds of a successful appeal, and the chances of an outcome which is not in favor of the Group is remote.

 

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(j) During the current period, the Company entered into a  100,000 million ($ 1,360 million) long-term syndicated loan facility agreement. This loan is secured by way of pledge over the shares held by the Company in Hindustan Zinc Limited (HZL) representing 14.82% of the paid up share capital of HZL along-with a non-disposal undertaking in respect of its shareholding in HZL to the extent of 50.1% of the paid up share capital of HZL. As at September 30, 2020, the principal amount participated for and outstanding under the facility is  50,000 million ($ 680 million).

(k) The Company’s statutory auditors, in their independent auditor’s review report dated November 06, 2020 on the unaudited consolidated financial results of the Company and its subsidiaries, its associates and joint ventures for the quarter ended September 30, 2020 and year to date from April 01, 2020 to September 30, 2020 submitted to the Indian stock exchanges pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended, qualified their conclusion regarding the Company’s wholly owned overseas subsidiaries’ loans (of which USD 956 million (approximately  70,400 million) was outstanding on the date of issuance of their report) and other receivables (of USD 35 million (approximately  2,580 million), including finance income of USD 9 million (approximately  660 million) on the aforesaid loans recorded in the current six months) from its parent companies and its subsidiaries. Owing to the inherent uncertainties caused by the fact that the parent company has reported a material uncertainty relating to its going concern and a funding shortfall in a plausible downside case, in its most recent financial statements for the year ended March 31, 2020, the auditor expressed their inability to comment on whether adjustments, if any, would be required to be made to the Company’s financial results for recording the aforesaid transactions initially at fair value and subsequently for recording any expected credit losses on such balances, as required under Ind AS 109. These results along with the independent auditor’s review report have been filed in the form 6-K with the SEC on November 10, 2020 and are also available on the Company’s website.

17. Related party transactions

Ultimate controlling party

Vedanta Limited is a majority-owned and controlled subsidiary of Vedanta Resources Limited (‘VRL’). Volcan Investments Limited (‘Volcan’) and its wholly owned subsidiary together hold 100 % of the share capital and 100 % of the voting rights of VRL. Volcan is 100 % beneficially owned and controlled by the Anil Agarwal Discretionary Trust (‘Trust’).

List of related parties and relationships

The Group enters into transactions in the normal course of business with its related parties, including its parent Vedanta Resources Limited (VRL), and the companies over which it has significant influence. A summary of significant related party transactions for the six months ended September 30, 2019 and 2020 and closing balances as at March 31, 2020 and September 30, 2020 are noted below.

The significant transactions relate to the normal sale and purchase of goods and loans and investments. All inter-company transactions and balances are eliminated on consolidation.

List of related parties and relationships -

 

A)

Entities Controlling the Company (Holding Companies)

 

   

Volcan Investments Limited (‘Volcan’)

 

   

Volcan Investments Cyprus Limited

Intermediate Holding Companies

 

   

Vedanta Resources Limited

 

   

Vedanta Resources Holdings Limited

 

   

Twin Star Holdings Limited

 

   

Finsider International Company Limited

 

   

Westglobe Limited

 

   

Welter Trading Limited

 

   

Richter Holdings Limited

 

   

Vedanta Resources Finance Limited

 

   

Vedanta Resources Cyprus Limited

 

B)

Fellow subsidiaries (with whom transactions have taken place)

 

   

Konkola Copper Mines*

 

   

Sterlite Technologies Limited

 

   

Sterlite Power Transmission Limited

 

   

Sterlite Iron and Steel Company Limited

 

   

Sterlite Power Grid Ventures Limited

 

C)

Post Retirement Benefit Plan

 

   

Balco Employees Provident Fund Trust

 

   

Hindustan Zinc Ltd Employees Contributory Provident Fund Trust

 

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Sesa Group Employees Provident Fund Trust

 

   

Sesa Mining Corporation Limited Employees Provident Fund Trust

 

   

Sesa Resources Limited Employees Provident Fund Trust

 

   

HZL Employee group Gratuity Trust

 

   

Sesa Group Employees Gratuity Fund and Sesa Group Executives Gratuity Fund

 

   

Sesa Resources Limited Employees Gratuity Fund

 

   

Sesa Mining Corporation Limited Employees Gratuity Fund

 

   

HZL Superannuation Trust

 

   

Sesa Group Executives Superannuation scheme Fund

 

   

Sesa Resources Limited and Sesa Mining Corporation Limited Employees Superannuation Fund

 

D)

Associates and Joint Ventures (with whom transactions have taken place)

 

   

RoshSkor Township (Pty) Ltd

 

   

Goa Maritime Private Limited

 

E)

Other Related Parties (with whom transactions have taken place)

I) Enterprises over which key management personnel/their relatives have control or significant influence

 

   

Vedanta Medical Research Foundation

 

   

Vedanta Foundation

 

   

Cairn Foundation

 

   

Sesa Community Development Foundation

 

   

Janhit Electoral Trust

 

   

Fujairah Gold Ghana

 

   

Runaya Refinery LLP

II) Enterprises which are Associates/Joint Ventures of entities under common control

 

   

India Grid trust **

 

*

Konkola Copper Mines Plc (KCM) ceased to be a related party w.e.f. May 21, 2019. In March 2020, a provision of  2,070 million was recognised in relation to monies advanced to KCM against future purchase of copper cathode/ anode.

 

**

Ceased to be related party during the year ended March 31st, 2020.

The below details provide the total amount of transactions that have been entered into with related parties for the relevant period. The significant transactions relate to the normal sale and purchase of goods and loans and investments.

 

          For the six months ended September 30, 2019  
          Entities controlling
the company/
Fellow  Subsidiaries
(
 in million)
     Associates/Joint
Ventures
(
 in  million)
     Others
(
 in million)
     Total
(
 in million)
     Total
(US dollars in million)
 
   Income:               
(i)    Sales      4,215        —          0        4,215        60  
(ii)    Other Income               
a)    Interest income /guarantee commission/ (Finance costs)      225        —          —          225        3  
b)    Outsourcing Service Income      15        —          —          15        0  
c)    Dividend Income      —          —          76        76        1  

 

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   Expenditure and other transactions:            
(i)    Purchases of goods/services      30       —          26       56       1  
(ii)    Long Term Incentive Plan (Recovery)      (4     —          (1     (5     (0
(iii)    Management and brand fees expenses      1,581       —          —         1,581       22  
(iv)    Corporate Social Responsibility Expenditure / donation      —         —          463       463       7  
   Transactions during the period:            
(i)    Loans given / (repaid)      0       3        —         3       0  
(ii)    Financial guarantee given / (taken)      —         —          77       77       1  
(iii)    Investment made/(redeemed)      44,847 (1)      —          —         44,847       635  
          As at Mar 31, 2020  
          Entities controlling
the company/
Fellow Subsidiaries
    Associates/
Joint Ventures
     Others     Total     Total  
          ( in million)     ( in million)      ( in million)     ( in million)     (US dollars in million)  
   Balances as at year end:            
(i)    Trade Receivables      30       —          —         30       0  
(ii)    Loans to      793       42        —         835       11  
(iii)    Receivable from      1,325     10        23       1,358       18  
(iv)    Trade Payables      1,143       —          67       1,210       16  
(v)    Payable to      601       —          681       1,282       17  
(vi)    Investments      1,013       —          —         1,013       13  
(vii)    Guarantees outstanding given / (taken)      —         —          255       255       3  
(viii)    Banking Limits assigned/utilised/renewed to/for group companies(4)      1,150       —          —         1,150       15  
(ix)    Remuneration, Commission and consultancy fees payable to KMP and their relatives      —         —          63       63       1  

 

*

During the financial year ended March 31, 2019, as part of its cash management activities, CIHL purchased an economic interest in a structured investment for the equity shares of Anglo American Plc (AA Plc), a company listed on the London Stock Exchange, from Volcan for a total consideration of  38,124 million (GBP 428 million, USD 541 million) determined based on an independent third-party valuation. In July, 2019, the transaction was unwound and the investments were redeemed for a total consideration of  44,847 million (GBP 519 million, USD 639 million), representing the actual price Volcan realised from selling the shares of AA Plc to an unrelated third-party net of applicable costs, out of which  926 million (GBP 10 million, USD 12 million) is outstanding.

 

          For the six months ended September 30, 2020  
          Entities controlling
the company/
Fellow Subsidiaries
     Associates/Joint
Ventures
     Others      Total      Total  
          ( in million)      ( in million)      ( in million)      ( in million)      (US dollars in million)  
   Income:               
(i)    Sales      3,544        —          37        3,581        49  
(ii)    Other Income               

 

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a)    Interest income /guarantee commission/ (Finance costs)      879       —          —          879        12  
b)    Outsourcing Service Income      16       —          —          16        0  
c)    Dividend Income      17       —          —          17        0  
   Expenditure and other transactions:              
(i)    Purchases of goods/services      —         —          91        91        1  
(ii)    Management and brand fees expenses      2,819       —          —          2,819        38  
(iii)    Corporate Social Responsibility Expenditure / donation      —         —          176        176        2  
(iv)    Guarantee Commission Expense (1)      544       —          —          544        7  
   Transactions during the period:              
(i)    Loans given / (repaid)      39,374 (2)      —          —          39,374        535  
(ii)    Financial guarantee given / (taken)      31,786 (2)      —          8        31,794        432  
(iii)    Financial guarantee relinquished      —         —          12        12        0  
          As at September 30, 2020  
          Entities controlling
the company/
Fellow Subsidiaries
    Associates/
Joint Ventures
     Others      Total      Total  
          ( in million)     ( in million)      ( in million)      ( in million)      (US dollars in million)  
   Balances as at year end:              
(i)    Trade Receivables      395       —          —          395        5  
(ii)    Loans to      39,512 (2)      43        —          39,556        538  
(iii)    Receivable from      10,558       10        23        10,591        144  
(iv)    Trade Payables      346       —          109        455        6  
(v)    Payable to      446       —          678        1,124        15  
(vi)    Investments(3)      174       —          —          174        2  
(vii)    Guarantees outstanding given / (taken)      31,267 (2)      —          250        31,517        429  
(viii)    Banking Limits assigned/utilised/renewed to/for group companies(4)      1,150       —          —          1,150        16  
(ix)    Remuneration, Commission and consultancy fees payable to KMP and their relatives      —         —          —          10        0  

 

(1)

Cairn PSC and OALP guarantee to Government

Vedanta Resources Limited as a parent company has provided financial and performance guarantee to Government of India for erstwhile Cairn India Group’s obligation under the Production Sharing Contract (‘PSC’). The guarantee provides for making available financial resources equivalent to Cairn India’s share for its obligation under PSC, personnel and technical services in accordance with industry practices and any other resources in case Cairn India is unable to fulfil its obligations under PSC.

Vedanta Resources Limited has also provided parent company financial and performance guarantee to Government of India for Vedanta Limited’s obligation under the Revenue Sharing Contract (‘RSC’) in respect of 41 Blocks awarded under the Round 1 of Open Acreage Licensing Policy (OALP) by Government of India. The guarantee provides for making available financial resources equivalent to Vedanta’s share for its obligation under RSC, personnel and technical services in accordance with industry practices and any other resources in case Vedanta is unable to fulfil its obligations under RSC.

 

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During the current period, the Board has approved a consideration to be paid for Guarantee provided for OALP blocks which will include one time charge of  1,839 million ($ 25 million) i.e. 2.5% of the total estimated cost of initial exploration phase of  73,540 million ($ 1 billion) and an annual charge of 1% of spend subject to a minimum of  735 million ($ 10 million) and maximum of  1,470 million ($ 20 million). The Company has paid  2,574 million ($ 35 million) till 30 September, 2020 to Vedanta Resources Limited in this regard.

 

(2)

As part of its cash management activities, the Company’s overseas subsidiaries had extended certain loan and guarantee facilities to Vedanta Resources Limited (VRL) and its subsidiaries. Subsequent to September 2020, the guarantee was extinguished and converted into a loan and a total amount of  70,340 million (US $956 million) is outstanding carrying interest @ 7% p.a.

 

(3)

During the period, part of investments in bonds of Vedanta Resources Limited have been disposed off in the open market for a consideration of  1,912 million (US $ 26 million).

 

(4)

Bank guarantee given by the Company on behalf of Volcan Investments Limited in favour of Income tax department, India as collateral in respect of certain tax disputes of Volcan.

18. Subsequent events

(I) Subsequent to the balance sheet date, the Board of Directors of the Company through resolution passed by circulation on October 24, 2020 have approved first interim dividend of  9.50 per equity share i.e. 950% on face value of Re. 1/- per share for the year ended March 31, 2021.

(II) Subsequent to the balance sheet date, Zinc International’s Gamsberg Mine had a geotechnical failure. Consequently, the mining activities at Gamsberg Mine have been suspended. The Group does not expect this to have a material effect on the financial position of the Group.

There are no other material adjusting or non-adjusting subsequent events, except as already disclosed.

 

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this report. We urge you to carefully review and consider the various disclosures made by us in this report and in our other SEC filings, including our annual report on Form 20-F for fiscal year 2020. Some of the statements in the following discussion are forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth elsewhere in this report and those set forth below.

Overview

We are a globally diversified natural resource company engaged in exploring, extracting and processing of minerals and oil and gas. We produce zinc, lead, silver, oil and gas, copper, aluminium, iron ore, steel, commercial power and glass substrate and have a presence across India, Ireland, Liberia, Namibia, South Africa, Australia, United Arab Emirates, South Korea and Taiwan. We have experienced significant growth through various expansion projects, acquisition of our zinc and aluminium businesses in 2002 and 2001 respectively, through the GoI’s disinvestment programs, the acquisition of the zinc business of Anglo American Plc in Namibia, South Africa and Ireland in fiscal year 2011, acquisition of oil and gas business in 2012, acquisition of 90.0% controlling stake in ESL under the Insolvency and Bankruptcy Code (IBC) 2016, in line with the Resolution Plan approved by NCLT, Kolkata and by successfully growing our acquired businesses. We have further strengthened our presence across commodities through an all share merger with Sesa Goa in August 2013 through the Re-organization Transactions. For more information refer our Annual Report on Form 20-F for the fiscal year ended March 31, 2020 filed with the SEC on September 25, 2020. We believe our experience in operating and expanding our business in India will allow us to capitalize on attractive growth opportunities arising from India’s large mineral reserves, relatively low cost of operations, inexpensive labor and large talent pools.

The following table is derived from our unaudited consolidated financial data and sets forth:

 

   

the revenue from external customers for each of our business segments as a percentage of our revenue on a consolidated basis;

 

   

the operating profit for each of our business segments as a percentage of our operating profit on a consolidated basis; and

 

   

the segment profit, calculated by adjusting operating profit for depreciation and amortization and other exceptional items, as applicable for each of our business segments, as a percentage of our segment profit on a consolidated basis.

 

     For the Six Months Ended
September 30,
 
     2019      2020  
     (in percentages)  

Revenue:

     

Zinc India

     21.6        25.6