New Delhi: Hit by a slump in demand and falling metal prices, London-listed Vedanta Resources sees its profit plunging by over 30% this fiscal.
“We have an impact (of the economic slowdown) on our profitability. Profits will be low by 30% or more for the whole year 2008-09,” Vedanta Resources chairman Anil Agarwal told PTI.
The metal and mining major saw prices of all its major products - copper, zinc, lead, aluminium and iron ore - dip by about 60% in the past six months due to the slackening demand amid the global industrial downturn, and it admits the pressure still exists.
“Pressure from price side is there. For example, our iron ore prices have fallen to $50 a tonne from the previous $150,” Agarwal said.
The London Stock Exchange-listed group saw its revenues declining by 31% at $1.30 billion for the third quarter ended 31 December 2008. Its revenues stood at $1.88 billion in the same quarter last fiscal.
Even as the company sees its profit margins taking a dip, it does not plan any immediate production cut.
Agarwal, however, said Vedanta would take necessary steps to run the group efficiently.
“We have neither reduced production nor intend to do so,” he said, adding that company would be undertaking a number of steps to reduce operating costs.