Can Lloyds replicate Gadchiroli success in Congo’s copper belt?

The mining company is targeting copper production in a region long considered both resource-rich and operationally challenging, where regulatory uncertainty, weak infrastructure and political risks have complicated operations for global miners.

Managing director Rajesh Gupta said the Congo bet mirrors the company’s early days in Maharashtra's Gadchiroli. “When we expanded our operations in Gadchiroli, the region was considered difficult and impossible,” Gupta said during an earnings call in February. Over time, the same narrative will emerge for Katanga and other parts of the world, he added.

The move comes as copper demand is expected to surge globally amid electrification, renewable energy and grid expansion, even as supply remains constrained. Global benchmark copper prices are currently around $11,000-12,000 per tonne, jumping a little over 30% over the last one year.

Execution risks

Drawing a parallel between operating a mine in Gadchiroli and in Congo is not entirely fair, said Suman Kumar, assistant vice-president for metals and mining at brokerage Philip Capital.

In India, companies understand regulatory and political ecosystem, but in foreign jurisdictions, especially parts of Africa, execution risks are far higher, said the sell-side analyst.

He pointed to examples of Indian companies that struggled to scale overseas mining projects, including Jindal Steel in Mozambique and Vedanta Ltd's challenges at Konkola Copper Mines in Zambia.

“Even companies with significantly deeper financial muscle have struggled. So any guidance on timelines or margins, particularly projections like 30% Ebitda by FY27, should be viewed cautiously. It is easier said than done,” Kumar said.

Meanwhile, Vedanta, in an email response, said its Zambia mines are raising production, with an average monthly output of around 8,000 tonnes.

Operational challenges

Multiple mining companies have faced operational and commercial challenges in Congo, said Satnam Singh, senior practice leader & director, Crisil Intelligence.

"China Molybdenum temporarily halted exports from its Tenke Fungurume copper-cobalt mine after disputes over export licences and taxation with state authorities, illustrating how regulatory uncertainty can interrupt production and contracts,” Singh said.

Commodities giant Glencore is in protracted negotiations with the Congolese government over joint venture terms and is currently in talks for a stake sale to a US-based consortium to reduce country risk, he added. There have also been temporary export bans, customs hold-ups, and policy shifts on minerals like cobalt and copper that have disrupted cash flow and offtake for multiple operators.

According to Crisil, Congo holds about 8% of global copper reserves and is the world’s second-largest producer, accounting for 14% of global output, behind Chile at 23%.

Mining in Congo carries high political and execution risks. "Armed group activity in eastern provinces, weak rule of law, and limited judicial enforcement increase sovereign and contract risks,” Singh said.

Crisil said Congo ranks in the bottom decile globally on Political Stability and Rule of Law in the World Bank Governance Indicators. It is the fifth most fragile in the Fragile States Index 2024 and 163rd out of 181 in Transparency International’s Corruption Perceptions Index 2025.

“Further, the country’s infrastructure is underdeveloped, making it difficult to transport equipment, personnel, and minerals,’ Singh pointed out.

Lloyds, in an email response to Mint's queries, however, said large operators such as Glencore, CMOC and Ivanhoe Mines, along with over 50 smaller producers, have operated in the country without major disruptions in the past decade.

Gadchiroli playbook

Mining operations will be handled by group company Thriveni Earthmovers and Infra. Senior executive B. Prabhakaran, who had led Lloyds' merger with Thriveni Earthmovers and Infra Pvt. Ltd in Gadchiroli had been tracking Congo's mining region, Gupta said.

Lloyds said it is confident of replicating its Gadchiroli success in Congo. The project follows two years of on-ground evaluation before the JV was formed. The company said it is working with local partners who have been running multiple businesses there for the last 25 years.

It plans to export 12,000-15,000 tonnes of copper from Congo, less than 0.4% of the country’s 3.5 million tonnes exports.

Through the acquisition of a 50% stake in Nexus Holdco FZCO16, Lloyds will hold mining leases covering nearly 100 sq. km. It acquired Nexus for a cash consideration of up to $55 million.

Lloyds aims 10,000 tonnes of copper cathode production in FY27, with a longer-term plan to scale up to 30,000 tonnes annually. Management expects margins of around 30% once operations stabilize.

It expects the copper business to contribute ₹500-700 crore in Ebitda in FY27. At current copper prices, the economics appear attractive. The Congo push comes at a time when Lloyds is executing a ₹14,000 crore domestic capex plan spanning pellet expansion, slurry pipelines and a foray into steelmaking.

Whether Congo becomes a repeat success story or a cautionary tale will depend on execution over the next two years. For now, Lloyds is betting that its playbook of on-ground presence can travel beyond India’s borders.