Vedanta Limited

Vedanta Limited
Public Limited
Traded as BSE: 500295
NSE: VEDL
NYSE: VEDL[1]
Industry Mining
Founded 1979 as Sesa Goa
Headquarters Mumbai- India
Key people
 Anil Agarwal
(Chairman Emeritus)
Navin Agarwal
(Chairman)
Srinivasan Venkatakrishnan
(Chief Executive Officer)
Arun Kumar
(CFO)
Products Zinc, Lead Oil and Gas, Iron ore, Aluminium, Copper, Gold and Silver
Revenue Increase ₹71,721 crore (FY2017)
Increase ₹7,323 crore (FY2017)[2]
Number of employees
 Approx. 60,000+ (2017)
Website www.vedantalimited.com

Vedanta Limited, formerly known as Sesa Sterlite/Sesa Goa Limited, is a mining company based in India, with its main operations in iron ore, Zinc and Aluminium mines in Goa, Karnataka, Rajasthan and Odisha.[3] It is 50% owned by Vedanta Resources (a UK based company controlled by the Anil Agarwal family) and 50% owned by other entities including the public, mutual funds and foreign investors.[4]

History

Scambi (1954-1963)

The company was founded in 1954, as Scambi Economici SA Goa.[5] Since then, it gradually grew to become a large low-cost producer of iron ore. During 1991–1995, it diversified into the manufacture of pig iron and metallurgical coke. Scambi Economici Societa Anonyma (SESA), owned by Baron Ludovic Toeplitz, with the financial backing of Alessandro Vassalo, obtained the Orasso Dongor mining lease in Sirsaim, Goa in 1954 and Sesa Goa Limited was formed. It was bought over in 1955, with equal shareholding, by Gewerkeshaft Exploration e Bergbau and Ferromin S.p.A., a subsidiary of Finsider S.p.A. (of IRI group), which eventually acquired the other half stake in 1963.

Sesa Goa (1963-2007)

Sesa Goa Limited was incorporated as a private limited company in 1963 under The Companies Act, 1956. In 1979, Sesa Goa Private Limited was formed, with the merger of Sesa Goa Limitada with another mining company in Goa, Mingoa Sociedade Miniera Goesa S.a.r.l. By 1965, Sesa Goa and Mingoa were incorporated as a private limited company under The Companies Act, 1956. The merger happened in 1979 and the new, unified company was called ‘Sesa Goa Pvt Ltd’. The company went public in 1981[6] with 42,000 Indian shareholders, holding 60% of its shares and the remaining 40% held by Finsider International, which later became ILVA International. Sesa Goa had started with iron mining as its core business but slowly, it ventured into barge construction in 1984 at Sirsaim, located in the Bardez taluka of North Goa. Since then, the barge construction unit has been developed into a shipbuilding division.[7]

In the 1990s, Sesa Goa began further expansion, aided by an influx of foreign investment durign the economic liberalization of India enforced by the World Bank and IMF. In 1992, the first phase of a 150,000 ton pig iron plant was commissioned. In the same year, Sesa introduced India’s first low-phosphorus foundry grade pig iron in India and subsequently formalised the business under pig iron division. The pig iron plant was located at Amona, Goa and had an annual production capacity of 250,000 tonnes per annum. Other alliances were formed in the nineties—in January 1995, Sesa Shipping was launched by acquiring atranshipper M.V. Orissa. The year also saw the inclusion of 84 new coke ovens. When Mitsui & Co. of Japan bought Finsider International in 1996, it gained 51% stake in Sesa Go. By 1997, Sesa Kembla became a 100% subsidiary of Sesa Goa.

In 1997, A Narrain mines located in Chitradurga, (Karnataka) were purchased. A Supreme Court directive in August 2011 led to suspension of mining activities in the region. In 1999, Sesa Goa started mining operations in Barbil, which has the fifth largest deposit of iron ore and manganese in the world. They started producing iron ore which was exported from the port towns of Haldia and Paradip. Durign this time, the company also started the Sesa Community Development Foundation that supported the NCM Sesa Technical School and a football academy called SESA F.A.

During the end of the 90s, the company also began to consolidate through mergers and acquisitions. Sesa Kembla completed the creation of an indigenous and environment-friendly technology that produced high-quality metallurgical coke. This technology generated power[8] as a by-product.[9] In 2003, the Sesa Goa equity in Sesa Industries was raised to 88.25%, impacting the shareholding pattern.

Take over by Vedanta (2007)

In 2007, Vedanta Resources Plc, a diversified metals and mining group founded by Anil Agarwal, acquired 51% controlling stake[10] in Sesa Goa Ltd. from Mitsui & Co. Ltd. Vedanta Resources is listed on the London Stock Exchange and a constituent of FTSE 100 Index. The deal was worth ₹40.7 billion (US$570 million), making it the largest M&A deal in the industry so far.[11] In 2009, Sesa Goa acquired Goa-based Dempo Group’s mining and maritime businesses for ₹17.5 billion (US$240 million) in an all-cash deal.[12][13] This was the second largest[14] acquisition in India’s iron-ore industry, and it gave Sesa Goa access to Dempo’s 70 million tons of iron-ore mineable resources in Goa. In 2011, Sesa Goa purchased 51% stake in Western Cluster, Liberia for $90 million.[15] The Liberia Gola Forest Community people who also suffered from the civil war believe that the coming of Western Cluster will help to alleviate their suffering and provide employment.

In 2007, it became a majority-owned subsidiary[16] of Vedanta Resources Plc, listed on the London Stock Exchange, when Vedanta acquired 51% controlling stake from Mitsui & Co., Ltd. In June 2009, Sesa Goa Limited acquired[12] VS Dempo & Co. Private Limited (now Sesa Resources Limited) along with its fully owned subsidiary Dempo Mining Corporation (now Vedanta Limited) and 50% equity in Goa Maritime Private Limited. In 2010, Vedanta acquired the zinc assets of British miner Anglo American plc.

In 2011 Vedanta Resources bought 58.5% controlling stake in Cairn India, India's largest private sector oil & gas company.[17] In 2015, Sterlite Industries and Sesa Goa announced their merger and finally merged into a single entity in August, 2015.[18] In 2015, Sesa Sterlite changed its name to Vedanta Limited.[19] On April 11, 2017, Cairn India merged with Vedanta Limited to consolidate its position as one of the largest diversified natural resources companies in the world.[20]

In 2018 Vedanta Limited acquired control of Electrosteels Steels Limited.[21] Electrosteel Steels had been constructing an integrated steel plant at Siyaljori in Jharkhand.

Operations

Vedanta limited owns, leases and operates in India through the following entities:

  • Hindustan Zinc, Rajasthan (in which Vedanta limited has a 64.9% stake)[4]
  • Sterlite copper[22]
  • Twin star (a Mauritius based offshore holding company that owns sizable parts of Vedanta limited)[4]
  • Cairn India and Cairn energy India (oil and offshore exploration)[22]
  • Mines in Goa and Karnataka (owned by Vedanta limited)[23]
  • Electrosteel Steels limited, Odisha (through Vedanta star, a holding company)[4]
  • Talwandi Sabo power limited (a thermal power plant in Punjab)[22]
  • Vedanta alumina limited (Lanjigarh, Odisha)[4][23]

Shareholding pattern

Originally founded as Sesa Goa, a Portuguese company, Sesa Goa was purchased by Vedanta (then known as Sterlite industries) in the 1990s. As of 30 June 2018, the company is owned 50% by the promoters (under the names of 12 members of the Agarwal family) and 50% by the public. This includes ownership by and "Westglobe limited", "Twinstar holdings", Finsider international and mutual funds (ICICI Prudential), foreign portfolio investors (17%), LIC India (6%) and Citibank New York (4%).[24]

Products

Zinc-Lead-Silver: Zinc India business is owned and operated by Hindustan Zinc Limited (HZL). HZL owns and operates a fully integrated zinc-lead business. HZL is one of the world's largest integrated zinc-lead producers by volume. Sesa Sterlite owns 64.9% of the share capital of HZL, while the Government of India remains an equity partner and holds a 29.5% stake. HZL is listed on Indian stock exchanges (NSE and BSE).HZL's fully integrated zinc operations include five lead-zinc mines, one rock phosphate mine, four hydrometallurgical zinc smelters, two lead smelters, one lead-zinc smelter, four sulphuric acid plants, one silver refinery and six captive power plants at our Chanderiya, Dariba and Zawar facilities in the State of Rajasthan, processing and refining facilities for zinc at Haridwar and for zinc, lead and silver at Pantnagar, both in the State of Uttarakhand and in northern India. In FY 2013, these operations delivered 870,000 tonnes of mined zinc-lead metal-in-concentrate, and 802,000 tonnes of refined zinc and lead.

Oil & Gas: Sesa Sterlite's Oil & Gas operations comprise the assets of Cairn India in India, Sri Lanka and South Africa. Cairn India is India's largest private-sector crude oil producer, contributing to over 25% of India's crude oil production. Sesa Sterlite owns 58.9% of Cairn India, which is also the fastest-growing Asian E&P company (Platts 2011) and one of the top 20 independent E&P companies worldwide. Cairn India has interest in eight blocks in India, one in Sri Lanka and one in South Africa. Cairn India's resource base is located in four areas - the onshore RJ-ON-90/1 (Rajasthan) block, two blocks on the west coast of India, four blocks on the east coast of India (including one in Sri Lanka) and one block in South Africa. Cairn India's Rajasthan block is the largest onshore discovery in India in the last 20 years and has an estimated 7.3 billion barrels of oil equivalent in place with a basin potential to support a production rate of 300,000 barrels of oil per day. Cairn India has a strong track record of exploration, with nearly 50% exploration success ratio. It has initiated an exploration and appraisal programme to unlock further potential in the proven Rajasthan block. Cairn India has a planned net capital investment of US$3 billion through FY2016, with around 80% of this investment allocated for the Rajasthan block. Cairn India has a current operating capacity of 178,000 boepd at Rajasthan, and remains on track to deliver a FY2013-14 exit production target of over 200,000 boepd. The company has recently commenced gas sales from the Rajasthan Block. Sesa Sterlite's Oil & Gas operations comprise the assets of Cairn India in India, Sri Lanka and South Africa. Cairn India is India's largest private sector crude oil producer, contributing to over 25% of India's crude oil production.

Iron Ore:Sesa Sterlite is largest private sector exporter of iron ore in India and is developing large iron ore deposits in Liberia. Iron ore mining operations are carried out in the Indian States of Goa and Karnataka. We also manufacture pig iron and metallurgical coke. During FY 2013, our Indian iron ore operations were affected by a suspension of iron ore mining activities across the states of Goa and Karnataka. The Honourable Supreme Court allowed resumption of Karnataka mine in April, 13 subject to statutory clearances. Subsequent to receiving all the approvals they have started mining in Karnataka from 28 December, 13. In 2011, Sesa Goa limited had acquired iron ore assets in Liberia, with around 1 billion in reserves and resources across three deposits - Bomi Hills, Bea Mountain and Mano River, located at a distance of 70-140 kilometers from the port at Monrovia. Extensive drilling at our Liberia assets has confirmed a billion tonne of Iron Ore deposit last year with further multifold upside. Currently, they are reviewing the different phased options including the first phase of 2 million tons. Sesa Sterlite is largest private sector exporter of iron ore in India. Its subsidiary, Western Cluster Ltd is developing large iron ore deposits in Liberia.

Their copper business is principally a custom smelting operation located in India and Australia. Our Indian operations include a smelter, refinery, phosphoric acid plant, sulphuric acid plant and copper rod plant at Thoothukudi in southern India. Sesa Sterlite owns 100% of the Mt. Lyell copper mine in Tasmania, Australia, which produces a portion of the total requirement of copper concentrate at our Indian Operations. Production of cathodes at our Copper India business was 353kt in FY 2013. Our Australian operations produced 26kt of mined metal in FY 2013.Sesa Sterlite copper business is located in India. It also owns 100% stake in Copper Mines Of Tasmania Pty Ltd, Australia.

Aluminium: BALCO has a smelter capacity of 345 ktpa with capabilities to produce ingots, wire-rods, billets, busbars and rolled products. BALCO's operations include mines, refineries, smelters and captive power plants in the state of Chhattisgarh in India. Sesa Sterlite holds a controlling 51% stake in BALCO, while the Government of India remains an equity partner and holds the remaining 49% stake. The Korba-II Balco smelter produces 245 ktpa of aluminium and they are expanding production capacity to 570 ktpa with the commencement of the new Korba-III 325 ktpa smelter in FY 2014.BALCO's current operations have access to captive power from 540 MW thermal power plant. A new 1,200 MW power plant is expected to commence production soon.Beside this company has 1.75MTPA of aluminium manufacturing unit at Jharsuguda,Odisha.

Power: Sesa Sterlite is one of India's leading power producers with a capacity of 3,900 MW in commercial power. They have commercial power generation business which currently operates 2,400 MW Jharsuguda Power Plant in Odisha, 270 MW BALCO power plant in Chhattisgarh, 100 MW MALCO power plant in Tamil Nadu and 274 MW HZL wind power plants at various locations in India. They are also setting up a 1,980 MW Talwandi Sabo power plant in the state of Punjab. Talwandi Sabo Power Limited, a 100% subsidiary of Sesa Sterlite is setting up a 1,980 MW thermal power project in Punjab, with the first unit starting operations by Q3 FY2014. Hindustan Zinc has 274 MW of wind power generational capacity, making it one of the largest producers of wind power in India. MALCO operates a 100 MW plant.

Metallurgical Coke: Approximately 65% of total production is consumed by Sesa group, for its pig iron production. The remainder is sold to customers located in India. Sesa Goa has patented a technology that provides high quality output and produces power. It is a patented and follows a two-product process with metallurgical coke as the main product and the sensible heat of the exhaust flue gas as a co-product. This heat can be used for producing clean electricity. The company uses non-polluting, non-recovery Australian Technology. At the plant in Amona, negative pressure in the ovens ensures no polluting leakages.

Pig Iron: This business is skewed towards catering to the steel mills and foundries of the Indian market, in particular the Western and Southern India. The division manufactures basic, foundry and nodular grade pig iron and also sells slag. The annual production capacity is 250,000 tons per annum.

CSR & Sustainability

Vedanta invested US $37 million towards community development in 2015-16, benefitting over 2.25 million people globally.[25] The Confederation of Indian Indusry (CII) ranked Vedanta Limited and its subsidiary Hindustan Zinc among the top ten sustainable firms in India.[26] In FY2016, Vedanta recycled 47% of the fly ash generated through operations, as well as recycled 23% of the water utilized during its operations.[27]

The company has entered into a first of its kind, unique Public-Private-Partnership (PPP), with the Ministry of Women and Child Development, Government of India to start Project Nandghar all over the country. This project aims to modernize and construct the Anganwadi infrastructure in India.[28] With the aim to supplement inclusive economic growth in India, Vedanta focuses on women empowerment through its CSR initiatives. The company's CSR initiatives 32,600 rural women through the creation of about 1,500 Self Help Groups in the communities, across the locations of its operations.[29]

Sterlite Protest

Thousands of residents in Tuticorin have been protesting for more than three months against the Sterlite copper smelting plant and its expansion. Due to which the Government placed an order to close down the factory and it was later celled by district collector.[30][31] In May 2018, amidst ongoing protests by thousands of people the police opened fire that killed 13 people. Residents who say the copper smelter is causing environmental damage, have been protesting against it for months. Tamil Nadu chief minister Palaniswami has ordered a judicial inquiry into the shootings but defended the police response.[32][33][34]

Offices

The registered office and corporate office of Vedanta Limited are based in Mumbai.[35] The company has offices in New Delhi, NCR as well as across its operations in the country.

See also

Notes

  1. ↑ Annual report 2017-18 (PDF). Panaji: Vedanta Limited. 1 September 2018. Retrieved 30 September 2018.
  2. ↑ "Consolidated Results for the fourth Quarter and full year ended 31 March 2016" (PDF). Retrieved 5 June 2017.
  3. ↑ "Vedanta's Sesa Iron Ore to make all mines operational in Goa". Business Standard. 25 June 2016. Retrieved 28 April 2017.
  4. 1 2 3 4 5 Vedanta's billions: regulatory failure, environment and human rights (PDF). Sussex: Foil Vedanta. 1 September 2018. Retrieved 30 September 2018.
  5. ↑ http://profit.ndtv.com/Corporate/Company-History/100295/Sesa-Goa-Ltd-?microslug=livebudget2012
  6. ↑ "Sesa Goa: Volume expansion to drive growth". Archived from the original on 14 September 2012. Retrieved 5 June 2017.
  7. ↑ http://www.edelweiss.in/market/Information.aspx?co_code=502&tb=CH
  8. ↑ "The Hindu Business Line : FFE Minerals ties up with Sesa Kembla for coke oven". Thehindubusinessline.in. 2004-02-04. Retrieved 2016-12-01.
  9. ↑ "Vedanta Chairman Speech | Vedanta Ltd Chairman Speech". Economictimes.indiatimes.com. 2012-12-05. Retrieved 2016-12-01.
  10. ↑ "Archive News". The Hindu. Retrieved 2016-12-01.
  11. ↑ "Vedanta bags Mitsui's 51% in miner Sesa Goa". Indian Express. 2007-04-25. Retrieved 2016-12-01.
  12. 1 2 "Sesa Goa buys Dempo's mining biz | Business Standard News". Business-standard.com. Retrieved 2016-12-01.
  13. ↑ Panaji, DHNS:. "Sesa Goa buys Dempo mining firm". Deccanherald.com. Retrieved 2016-12-01.
  14. ↑ "Sesa Goa acquires Dempo Mining « WeeksUpdate". Weeksupdate.com. 2014-06-21. Retrieved 2016-12-01.
  15. ↑ PTI (2011-08-06). "Sesa Goa to buy 51% stake in Western Cluster for $90 mn". Livemint. Retrieved 2016-12-01.
  16. ↑ Our Bureau (2012-02-25). "Vedanta to merge Sesa Goa, Sterlite Ind in all-share deal | Business Line". Thehindubusinessline.com. Retrieved 2016-12-01.
  17. ↑ Utpal Bhaskar (2011-12-08). "Vedanta’s Cairn India stake buy completed". Livemint. Retrieved 2016-12-01.
  18. ↑ "Sesa Goa, Sterlite Combine to Reduce Debt of Parent Vedanta". Archived from the original on 23 August 2016. Retrieved 5 June 2017.
  19. ↑ "Sesa Sterlite renamed as Vedanta Ltd". The Hindu. 2015-04-22. Retrieved 2016-12-01.
  20. ↑ ET Bureau (April 12, 2017). "Cairn India merges with Vedanta". economictimes.indiatimes.com. Retrieved June 5, 2017.
  21. ↑ "Vedanta enters steel with acquisition of Electrosteel Steels, to hold 90%". Business Standard, 5 June 2018. Retrieved 16 July 2018.
  22. 1 2 3 "Our operations". www.vedantalimited.com. Vedanta limited. Retrieved 30 September 2018.
  23. 1 2 Annual report 2017-2018 (PDF). Mumbai: Vedanta Limited. 1 September 2018. Retrieved 30 September 2018.
  24. ↑ "Share holding pattern - Vedanta Limited, India" (PDF). www.vedantalimited.com. Vedanta official / letter to SEBI. Retrieved 30 September 2018.
  25. ↑ PTI Report (5 August 2016). "Vedanta Resources to invest $30 million in R&D: Anil Agarwal". www.financialexpress.com. Retrieved 5 June 2017.
  26. ↑ PTI Report (16 March 2016). "Vedanta among top 10 sustainable firms in India: CII". www.dnaindia.com. Retrieved 5 June 2017.
  27. ↑ Express News Service (28 March 2017). "Vedanta launches green initiative to dispose red mud in Odisha". www.newindianexpress.com. Retrieved 5 June 2017.
  28. ↑ HBL Bureau (21 September 2015). "Govt inks MoU with Vedanta to build 4,000 'next generation' Anganwadis". www.thehindubusinessline.com. Retrieved 5 June 2017.
  29. ↑ "Vedanta aims to make women self-reliant by implementing skill development". www.deccanchronicle.com. 8 March 2016. Retrieved 5 June 2017.
  30. ↑ https://www.ndtv.com/india-news/tuticorin-anti-sterlite-protest-power-cut-for-vedanta-owned-sterlite-in-tuticorin-10-latest-facts-1857089
  31. ↑ http://www.business-standard.com/article/companies/sterlite-s-pollution-problem-113041801267_1.html
  32. ↑ http://www.dinamalar.com/news_detail.asp?id=2027846
  33. ↑ https://www.bbc.com/news/world-asia-india-44234715
  34. ↑ https://www.firstpost.com/india/sterlite-protest-live-updates-palaniswami-govt-appeals-against-madras-hc-order-to-preserve-bodies-of-thoothukudi-victims-4480617.html
  35. ↑ "Vedanta Limited registered office". www.vedantalimited.com. Retrieved 5 June 2017.

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