Interim Results

15 November 2013

Vedanta Resources plc

Interim Results for the Six Months Ended 30 September 2013

Financial Highlights

n Revenue of US$6.2 billion, down 17%

n EBITDA¹ of US$2.2 billion, EBITDA margin of 44.5%² despite volatile commodity prices

n Underlying EPS³ of 29.3 US cents, down 70%

n Free cash flow of US$1.0 billion before growth capex and US$417 million after growth capex

n Net Debt reduced by US$1.6 billion over the last 18 months

n Interim dividend of 22 US cents per share, up 5%

Business Highlights

n Group simplification completed

n Record oil & gas production

n Increased production of refined zinc, lead and silver at Zinc India

n Continued strong performance at Aluminium

n Karnataka iron ore mine awaiting final clearances to resume mining; Supreme Court's interim order on Goa iron ore mining permits sales from inventory

n Engaged with various stakeholders, including the Zambian Government, to drive productivity, cost improvements and an overall turnaround of the Copper Zambia business

n Strong cost performance despite industry-wide inflationary trends

(in $ millions, except as stated)

1. Earnings before interest, taxation, depreciation, amortisation /impairment and special items.

2. Excludes custom smelting at Copper and Zinc-India operations.

3. Based on profit for the period after adding back special items and other gains and losses, and their resultant tax and non-controlling interest effects (refer to note 6 of Condensed financial statements). Underlying attributable profit includes the net tax benefit from the SesaSterlite merger offset by a deferred tax charge due to the change in tax rates at Cairn India as set out on page [13].

Mr Anil Agarwal, Chairman of Vedanta Resources plc said, "The successful completion of the Sesa Sterlite merger during this half year is a significant milestone. Operational performance has been particularly strong in our high margin Oil & Gas and Zinc India businesses, with record production achieved at Cairn India. We continue to focus on driving value-accretive growth across our diversified portfolio of Tier-1 assets and this, combined with efficient cost management and our strong position in fast growing emerging markets has positioned us well to sustainably create long term value for our shareholders."

For further information, please contact:

About Vedanta Resources plc

Vedanta Resources plc ("Vedanta") is a London listed FTSE-100 diversified global resources major. The group produces Aluminium, Copper, Zinc, Lead, Silver, Iron ore, Power, and Oil and Gas. Vedanta has world-class assets in India, Zambia, South Africa, Namibia, Ireland, Liberia, Australia and Sri Lanka and a strong organic growth pipeline of projects. With an empowered talent pool globally, Vedanta places strong emphasis on partnering with all its stakeholders based on the core values of entrepreneurship, excellence, trust, inclusiveness and growth. For more information, please visit: www.vedantaresources.com.

Disclaimer

This press release contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "should" or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, uncertainties arise from the behaviour of financial and metals markets including the London Metal Exchange, fluctuations in interest and or exchange rates and metal prices; from future integration of acquired businesses; and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory nature. These uncertainties may cause our actual future results to be materially different that those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.

CHAIRMAN'S STATEMENT

We have continued to make strong progress towards achieving our strategic priorities in the first half of the financial year (H1 FY2014). Specifically, the completion of the group structure simplification is a significant milestone. It has consolidated Vedanta's holdings in its subsidiaries, created a more efficient capital structure by better aligning operating cash flows and debt across the group, and has delivered significant financial synergies.

Vedanta's portfolio of Tier-1 assets with low all-in costs is well diversified across base metals, oil & gas, bulks and commercial power, and has enabled us to consistently deliver industry-leading profit margins, with our EBITDA margin¹ remain strong at 44.5% in H1, demonstrating the resilience of our low-cost diversified portfolio.

Operationally, we have continued to deliver profitable production growth at our two largest businesses, Zinc-India and Oil & Gas, which have consistently delivered lowest quartile costs, and achieved record oil & gas production in the first half. Our Aluminium operations continued to operate at lower half operating costs despite having to source third-party bauxite and alumina. Our Iron Ore operations continued to be affected by state-wide mining restrictions, but recent developments have been in the right direction and we expect to restart mining in Karnataka soon. Our Copper Zambia operations were affected by lower volumes and higher costs. We are committed to delivering an operational turnaround of the Copper Zambia business and remain engaged with various stakeholders including the Government of Zambia to improve productivity, volumes and profitability.

We continued to deliver strong free cash flows after capex during the first half as assets utilizations increased and production volumes ramped-up. We continue to carefully monitor allocation of capital to various businesses and projects. A significant part of our near term capex will be allocated to phased, brown-field projects at high-margin businesses. Our key projects include the 20% growth, to 1.2mtpa, of mined metal at Zinc-India, and exploration in the prolific Rajasthan block to realize our vision of 300kbopd. We will continue to use our strong and growing free cash flows to further deleverage the balance sheet.

Sustainability and safety remains core to our business and we have consistently reduced our lost time injury frequency rate, by more than half over the last 5 years. We need to work further to eliminate fatalities and are focused on implementing our unsafe conditions elimination programme. We are also committed to building strong relationships with our local stakeholders in order to directly and indirectly develop the local economy and communities where we operate. We have more than 250 partnerships with NGOs, local governments, academic institutions and private hospitals in place, and our community programmes benefit around 3.7 million people in India and Africa, across 2,200 villages. We have also had success in reducing our specific consumption of water and energy and continue to implement further projects. We continue to be one of the largest employers and contributors to Government exchequers in the countries where we are located, and in H1 our contribution to Government exchequers was $2.6 billion.

We have maintained a progressive dividend since the listing in 2004, and this year the Board has recommended an interim dividend of 22 US cents per share, an increase of 5%.

On behalf of the Board, I thank our 87,000 direct and indirect employees for their contribution to these results. Their commitment and efforts, combined with the strength of our management team, continue to drive our performance.

We remain positive on the prospects for our diversified portfolio of Tier-1 assets, which we believe will generate strong returns across business cycles. The strength of our portfolio and our focus on disciplined capital allocation to phased, low-risk projects with high returns will enable us to continue to consistently generate strong returns for shareholders.

Anil Agarwal

Chairman

14 November 2013

1. Excludes custom smelting at Copper and Zinc India operations.

Interim Results for the Half Year Ended 30 September 2013

Consolidated Group

(In US$ million unless otherwise stated)

1. After adding back special items and other gains and losses and their resultant tax and non-controlling interest effects.

2. Refer to calculation given on page no. 16.

Highlights:

n Group structure consolidation and simplification completed

n Robust operating results driven by improved production partially offset by lower commodity prices

n Net debt reduced by US$153 million in H1 FY 2013

n Record production of Oil & Gas and increased production of Zinc, Lead and Silver at Zinc India

n EBITDA at US$2.2 billion, a 14% decrease reflecting weaker commodity prices partly neutralised by lower costs and increased volumes at Zinc India and Oil & Gas business, a higher percentage share of profit petroleum paid to the Government of India in our oil& gas business, absence of iron ore mining in Karnataka and Goa and lower volume in KCM. EBITDA margin remained strong at 44.5% (excluding custom smelting) reflecting efficient cost management

n Attributable loss of US$217million accentuated by other gains and losses of US$433 million largely due to mark to market foreign exchange losses

n Strong free cash flow of US$1.0 billion; Free cash flow after project capital expenditure US$0.4 billion

n Interim dividend of 22 US cents per share, a 5% increase on the interim dividend of FY 2012-13

Performance Review

Progress against strategic priorities

Vedanta's strategy remains focused on delivering growth, long-term value and sustainable development through our diversified portfolio of Tier-1 assets. Our diversified portfolio spread across base metals, bulks, oil & gas and commercial power comprises large, low cost, long life and scalable assets, located close to high growth emerging markets. Our assets have delivered consistent EBITDA margins (excluding custom smelting) of around ~45%. We are now delivering strong growth in free cash flows from most of our businesses, with production growth coming through and bulk of our investment programme in our metals business now largely complete. Growth projects in our Aluminium and Power businesses are also nearing completion and will contribute to cash generation in medium term.

This is supplemented by a disciplined approach to capital allocation, in order to generate superior shareholder returns. Our capital allocation policy prioritises low risk, phased developments, with the emphasis on those businesses that generate highest returns.

Group consolidation and simplification

The Group structure consolidation and simplification exercise, announced in February 2012, was concluded and took effect in two phases on 17 August 2013 and 19 August 2013. As part of the reorganisation Sterlite Industries India Limited (SIIL), Vedanta Aluminium Limited (VAL), Madras Aluminium Company Limited (MALCO) and Sterlite Energy Limited (SEL) were merged with Sesa Goa Limited and renamed Sesa Sterlite Limited (SSL). On 26 August 2013, Vedanta also transferred the shareholding of one of its subsidiaries which held 38.7% stake in Cairn India Limited (Cairn), to SSL, along with the associated debt of USD5.9 billion. On 19 August 2013, the Power business was transferred from VAL to SSL at its carrying value through a sale and purchase agreement on a going concern basis. The Power business consists of the 1,215MW thermal power facility at Jharsuguda and the 300MW co-generation facility (90MW operational and 210MW under development) at Lanjigarh. These transactions are within the subsidiaries of the Company and will not have any acquisition accounting impact other than a change in the economic shareholding percentage. The simplification exercise has resulted in a change in economic holding percentage mainly in VAL and Cairn. VAL's effective holding has decreased from 87.6% to 58.3% whereas Cairn's reduced from 49.8% to 34.3%. The equity and non-controlling interest have been adjusted to reflect these changes in the economic shareholding.

The Group simplification has created a platform that will deliver financial and operational synergies, including improving the ability to transfer cash between divisions to facilitate debt servicing, more effective cash management and tax optimisation.

Key developments

The National Green Tribunal's favourable order paved way for restarting Tuticorin smelter, following the temporary closure in the first quarter of the year.

Production also restarted at the 1 mtpa capacity Lanjigarh alumina refinery after a temporary shutdown. We continue to actively engage in discussions with the Orissa State Government for allotment of alternative bauxite mines. The final stage forest clearance for the Niyamgiri Mining lease, which is one of the sources of supply of bauxite close to the Lanjigarh alumina refinery, is awaiting the final decision of The Ministry of Environment and Forests ("MOEF") following submissions by the court convened Gramsabha.

Following the lifting of restrictions on mining at Karnataka by the Supreme Court, we are now awaiting final statutory clearance and expect to resume mining at Karnataka shortly. The Supreme Court has recently announced its interim order, allowing sale of inventory of iron ore. They have also mandated the setting up of an expert committee to determine how much mining should be permitted in the state of Goa.

Work on the major mining capacity expansion projects in Zinc India is making good progress. The Rampura Agucha underground mining is operational using a ramp. Kayad mine will also commence production in the current financial year. Though the expansion project from 1 mtpa to 1.2 mtpa is going to be completed by 2019, the project is so designed that it starts delivering the cash flow from FY2014 itself. The yearly capex will be around US$250 million.

Robust performance in an uncertain environment

Vedanta delivered robust results in H1 FY 2013-14, against a backdrop of slower global growth rates and volatile commodity and currency markets. Our improved operational and cost performance partially mitigated the threat posed by this challenging economic environment, enabling us to achieve US$2.2 billion EBITDA, down by 14% compared with H1 of last year due to the impact of continued iron ore mining ban and stoppages at the Tuticorin plant. EBITDA margin excluding custom smelting, was strong at 44.5% despite weaker prices, which reflects our continued strong track record of operating performance offset by the continuing mining ban in Iron Ore operations. Our financial performance during this period reflects record production of Oil & Gas and increased production of Zinc, Lead and Silver at Zinc India. Our Aluminium business also performed well in this challenging environment and operated above its rated capacity. We have been able to retain/improve our global cost competitiveness by ensuring that we are well positioned on global cost curves.

Operating profit before special items was US$1.1 billion. The Group's operating profit benefited by US$48 million from the devaluation of the rupee in the period, which also reduced costs per tonne in US Dollar terms.

Profit before tax was significantly impacted by other gains and losses mainly due to higher rupee depreciation resulting in mark to market foreign exchange losses of US$429 million as compared to foreign exchange losses of US$142 million in the prior period. An attributable loss of US$217 million was recorded as compared to a US$174 million attributable profit in H1 FY 2012-13. Underlying attributable profit (as defined) after adjustment for special items and other gains and losses was US$80 million.

Strong free cash flow of US$1.0 billion and free cash flow after project capex was US$0.4 billion.

Sustainability

Sustainability is an integral part of our business. Considering the nature of our industry safety, health and the environment are our priorities. We continue to strive for zero harm, implementing a range of structured programmes to enhance safety, focused on processes, behaviour and continuous improvement based on our experience. While the leading indicators such as Lost Time Injuries Frequency Rate per million man-hours worked have shown an improving trend, we remain concerned about high impact low probability incidents. In the first six months of the year, tragically six workers lost their lives in workplace accidents. We need to further strengthen and intensify our safety enhancement programmes.

We continue to maintain our good track record in managing health and environment performance. There were no significant environmental incidents during H1 FY 2013-14 and no significant health related observations in the same period. All our businesses continue to run structured improvement projects to continuously improve our performance on air, water and land use performance. Over the last 2 years we have further embedded the sustainability framework and implemented its practices and standards. We are committed to ensuring that the framework is followed and managed in all our operations and any new project.

Outlook

The key trends of infrastructure development and urbanisation in emerging economies will continue to be the main drivers of demand in the near term although growth rates have moderated in most developing economies, including India and China. Volatility in developed economies continues with both, modest recovery in the US and ongoing weak conditions in the Eurozone. Constrained capital expenditure across the resources industry should limit growth in supplies thus provide fundamental support for prices in the coming years.

Against this backdrop, the mining industry is currently facing headwinds in the form of price pressures and also, our sustained focus on operational and cost efficiency will help mitigate these pressures.

We remain positive on the prospects for our diversified portfolio of assets. We remain focused on measured capital allocation, with a focus on low-risk, phased projects that generate high returns and our proximity to emerging markets, means we are well positioned to take advantage of the opportunities these markets will offer going forward.

Finance Review

Basis of presentation of financial information

Our interim financial report is prepared in accordance with International Financial Reporting Standards ('IFRS'), as adopted by the European Union. Our reporting currency is US dollar.

Consolidated Group Results

(in US$ million, except as stated)

Operating Profit Variance

Consolidated Group

(In US$ million)

Prices

Metal and oil prices weakened during the reporting period, impacting our revenues. In the first half of the year, average prices fell by 9% for copper, 7% for aluminium and 3% for zinc. Average Brent prices were also lower by 2%. These lower average prices across all commodities had a negative impact of US$225 million on operating profit.

Exchange rates

Exchange rate volatility increased during the first half of the year which improved operating profit margins for our businesses located in India as the depreciation of the Indian rupee reduced the costs in dollar terms. Combined with higher sales revenues in rupee terms, this improved operating profits by US$48 million.

Profit petroleum

During the period in Cairn India, the share of profit petroleum charges increased from 20% to 30%, payable to the Government of India resulting higher charges by US$140 million.

Volumes

Higher oil and gas production, increased volume of refined zinc, lead and silver at Zinc India and strong operating performance at our Aluminium business delivered volume growth which generated a positive contribution of US$151 million to operating profits, offset by lower volume at Konkola Copper Mines (KCM) resulted in a US$45 million reduction in operating profit with a net total impact US$106 million. The temporary closure of the Tuticorin Smelter in Q1 impacted operating profit by US$33 million and the continued iron ore mining ban contributed a negative variance of US$134 million to operating profits compared with H1 FY 2012-13.

Costs

The cost-inflationary environment prevailing in the sector was largely mitigated by higher production volumes at Zinc India and Aluminium business, operational efficiencies and the depreciation of the Indian rupee against the US dollar in which most of our costs are denominated. Our overall operating profits increased by US$13 million due to the improved costs as compared with the corresponding prior period.

The following exchange rates against the US dollar have been applied:

* Kwacha has been devalued with effect from January 2013.

Depreciation

There was no major capitalisation in the first half of FY 2013-14 with no significant changes in depreciation as a result, however depreciation reduced by US$17 million mainly due to rupee depreciation.

Amortisation

The mining reserves related to our acquisitions mainly of Cairn, Zinc International and Sesa Goa are being amortised on a unit of production basis over the total estimated remaining commercial reserves.

The reduction in amortisation charges in H1 FY 2012-13 as compared to the previous year was US$23 million, mainly due to lower production volumes in our Iron ore business as a result of the ongoing mining ban.

Income Statement

(in US$ million, unless otherwise stated)

Revenue

Volume increases at Cairn India, Zinc India and at Vedanta Aluminium and BALCO, our aluminium businesses, had a positive impact on revenue which was offset by lower commodity prices, the temporary closure of the Tuticorin copper smelter for a quarter, reduction in production at KCM and the impact of the continued mining ban on our Iron Ore business. This resulted in revenues for the first half of the year of US$6,164 million, 17% lower than the same period last year.

EBITDA Margin

Despite lower revenue and EBITDA, the EBITDA margin excluding custom smelting operations and the petroleum profit sharing charges, was 44.5%, in line with the first half of the previous year. Despite the weaker commodity price environment in the period, the strength of our diversified portfolio and high margins in our Oil & Gas business, helping us to improve overall margin performance.

Special Items

The decrease in zinc prices have resulted in an impairment charge of US$48 million (US$37 million after deferred tax) being recorded against the value of mining reserves in Lisheen, which is nearing its end of life. In addition US$14 million relating to voluntary redundancy charges and acquisition related costs (H1 FY 2012-13 US$ 7 million) at Zinc India and KCM have been accounted for in special items.

Depreciation and Amortisation

There was no major capitalisation in the first half of FY 2013-14 with US$17 million reduction in depreciation charge mainly due to rupee depreciation. Amortisation charges of our acquisition related expenses were lower by US$23 million mainly due to reduced production volumes in our Iron Ore business following the continued mining ban.

Net interest

Gross finance costs increased marginally to US$700 million in H1 FY 2013-14 as compared to US$680 million in H1 FY 2012-13. The gross finance cost increased due to refinancing of loans at Vedanta plc and amortisation of borrowing cost due to prepayment of Cairn acquisition loan partially offset by lower interest costs in US dollar terms on rupee borrowing on account of rupee depreciation. The interest capitalised in H1 FY 2013-14 was lower at US$39 million (H1 FY 2012-13 US$134 million) due to cessation of capitalisation of borrowing cost at Jharsuguda Plant 2 due to delay in commissioning and also capitalisation of all units of the 2400 MW power plant at Jharsuguda. As a result the finance costs charged to the income statement increased to US$661 million in H1 FY 2013-14 up from US$546 million last year.

Investment revenues in H1 were marginally lower at US$303 million as compared to US$310 million in the corresponding prior period despite increase in the cash and liquid investment at Cairn India and Zinc India. The investment revenues were impacted due to unprecedented increase in interest rates in India which resulted in mark to market losses of US$50 million on investment in mutual funds and bonds. Due to stabilisation in the interest rates we expect improved investment revenues in second half of the financial year.

As a result Net interest expenses increased to US$358 million from US$236 million in H1 FY 2012-13.

Other Gains and Losses

Other gains and losses include the impact of mark to market (MTM) on foreign currency borrowings, primarily at our Indian businesses. The other gains and losses in H1 FY 2013-14 were US$433million, as compared with a loss of US$129 million in H1 FY 2012-13. During first half of this year, MTM losses on foreign currency borrowings were US$429 million (H1 FY 2012-13 US$142 million), following the unprecedented 15% depreciation of the Indian rupee against the US dollar as compared to 31 March 2013.

Taxation

The effective tax rate for H1 FY 2013-14 was lower at 7% largely due to reversal of US$263 million of current tax charge booked in earlier years due to group consolidation and simplification. This was partially offset by a period charge of US$150 million in Cairn India due to increased deferred tax liability on account of increase in tax surcharge by 5% on the acquisition fair values.

Attributable (Loss)/Profit

Attributable loss in H1 FY 2013-14 was US$217 million, significantly lower compared with US$174 million attributable profit in H1 FY 2012-13, primarily due to lower EBITDA, foreign exchange losses and higher net interest expenses. Underlying profit(as defined) in the first half of the year, excluding the impact of MTM losses and special items was lower at US$80 million as compared with US$267 million in H1 FY 2012-13.

Earnings Per Share ('EPS') and Dividend

Basic EPS in H1 FY 2013-14 was negative 79 US cents per share (H FY2012-13 64 US cents per share). Diluted EPS in H1 FY2012-13 was negative 77 US cents per share (H1 FY 2012-13 63 US cents per share).

However, if we exclude special items and other gains and losses, the underlying EPS for the first half of the year excluding the impact of MTM losses and gains on embedded derivatives and special items, was 29 US cents (H1 FY 2012-13 98 US cents).

The Board has declared an interim dividend of 22 US cents per share an increase of 5% as compared to 21 US cents in FY 2012-13.

Balance Sheet

(In US$ million, except as stated)

* includes intangible assets US$92.5 million in H1FY2014.

Shareholders' equity was US$3,858 million at 30 September 2013 compared to US$4,401 million at 31 March 2013 reflecting impact of currency depreciation of the Indian rupee against the US dollar by US$757 million, attributable losses of US$217 million due to equity holders during the period, dividend payment and movement of convertible bond reserves. These negative impact were partially offset by an increase in equity attributable to shareholders of US$627 million due to changes in economic holding percentages as result of group simplification and consolidation.

Non-controlling interest decreased to US$13,077 million as at 30 September 2013 from US$14,468 million as at 31 March 2013, due to share of losses, change in economic holding percentages as well as foreign currency movements.

Tangible Fixed Assets

During the first half of the year, we added US$802 million to property, plant and equipment comprising of US$630 million for our expansion and improvement projects and US$172 million spent on sustaining or ongoing capital expenditure. Expansion project expenses were mainly incurred at Talwandi Sabo Power Limited (TSPL), at our Aluminium business and at Cairn India. The value of property, plant and equipment on the balance sheet reduced by US$1,925, reflecting the depreciation in the rupee during the period. Expansion expenditure was significantly lower by US$324 million than during the same period last year reflecting our commitment for prudent capital allocation and our aim to deleverage the balance sheet.

Net Debt

Net debt reduced by US$ 153 million, at 30 September 2013, where net debt was US$8,463 million (31 March 2013 US$8,616 million). Cash and liquid investments were US$8,135 million as at 30 September 2013. Gross debt as at 30 September 2013 was US$16,605 million (31 March 2013 US$16,593 million). The unprecedented rupee depreciation reduced the gross debt by US$941 million and correspondingly the foreign exchange fluctuation reduced cash and liquid investments by US$937 million.

The average debt in H1 FY 2013-14 was US$16,747 million, which was in line with the previous year (H1 FY 2012-13 US$16,778 million). The average debt maturity at 30 September 2013 increased to 4.0 years on exclusion of working capital loans at operating subsidiaries. External debt at our operating subsidiaries was US$8,516 million (US$12.4 billion including intercompany debt payable to Vedanta plc companies) and debt at Vedanta plc was US$8,090 million (which, net of intercompany loan to TMHL would be US$4,196 million). Of the total debt of US$16,605 million, US$1,801 million consists of convertible bonds.

During the first half of FY 2013-14, the Company refinanced the Cairn acquisition loan of US$2.7 billion by a combination of high yield bonds with an average maturity of 6.6 years and term loans with an average maturity of 3.2 years. These issues generated an excellent response and were well received in the market. Near term debt maturities at face value of US$500 million at Vedanta plc due in January 2014 have been refinanced.

Our cash and liquid investments portfolio continues to be conservatively invested in debt mutual funds and in cash and fixed deposits with the banks.

The Company continued to maintain its ratings from Standard & Poor's, Moody's & Fitch: ratings are BB, Ba1 and BB+ respectively.

Our balance sheet remained strong. The net gearing increased to 33.3% on account of Rupee depreciation and reduction in shareholders equity, as compared to 31.3% in FY 2012-13.

Debt maturity profile at Vedanta Resources plc is as follows:

Click the link to view image

http://www.rns-pdf.londonstockexchange.com/rns/1260T_1-2013-11-15.pdf

Notes:

1. Debt numbers shown at face value, excludes one year rolling working capital facilities of $1,365mn (of which $1,279mn is due in FY 2014 and $86mn is due in FY 2015).

2. $810mn of the $883mn convertible at Vedanta plc due in FY 2017 was put in March 2013 and was paid in April 2013. The balance $73mn is shown at the next put date of 30 March 2015. The $1,250mn convertible at Vedanta plc due in FY 2017 (with a put option in July 2014) is shown at first put date.

Cash Flows

(in US$ million, except as stated)

* On an accruals basis.

** Includes foreign exchange movements.

Free cash flow before growth capital expenditure in H1 FY 2012-13 was US$1,046 million which represents 47% of EBITDA as compared to 56 % in H1 FY 2012-13.

PROJECTS

Projects under execution (in US$ million, except as stated)

Interim Results For The Half Year Ended 30 September 2013

Operational Performance:

Zinc - India

Production Performance

1. Including captive consumption of 3kt each in H1 FY14 vs H1 FY13.

2. Excluding captive consumption of 0.57 million ounces in H1 FY 2014 vs 0.52 million ounces in H1 FY 2013.

Mined metal production increased in H1, up 22% as compared with the same period last year and integrated zinc and lead metal production in H1 was up by 18%.

Due to a significant improvement in the operational efficiency of our smelters, integrated production grew strongly with refined zinc up by 19%, lead by 13% and saleable integrated silver production up by 12%.

Markets

Zinc prices have declined following a strong start to 2013. There has however, been a sustained outflow of inventories which is resulting in lower LME stocks which may provide support for zinc prices going forward.

The tightness in the physical zinc market has firmed up premium, and it is anticipated that this upward trend will continue in the near future. In the medium term it is expected that supply growth is likely to fall short of demand growth and zinc prices are likely to firm up.

(US$ per tonne)

London Metal Exchange (LME) zinc prices averaged US$1,850 per tonne compared to US$1,906 per tonne in the same period in 2012.

Unit Costs

Unit costs of production excluding royalties were lower at US$810 per tonne in the first half of the year as compared with US$832 per tonne in the first half of last year. The business remains in the lowest cost quartile compared with the global producers, underpinned by high quality assets like the Rampura Agucha and Sindesar Khurd mines.

Financial Performance

(in US$ million, unless otherwise stated)

EBITDA for H1 FY 2013-14 was US$559 million, 10% higher than the same period last year. The increase was driven by higher sales volumes, the positive benefit of the Indian rupee depreciation and the increase in metal premium, partially offset by lower zinc and silver prices.

Outlook

We expect mined metal production of ~950,000 MT in FY 2013-14. The momentum in integrated zinc-lead production in H1 is expected to continue in H2. Integrated saleable silver production is projected to be ~335 MT in FY 2013-14.

Projects

Work on the major mining capacity expansion projects in Zinc India is making good progress. The Rampura Agucha underground mining is operational using a ramp. Kayad mine will also commence production in the current financial year. Though the expansion project from 1 mtpa to 1.2 mtpa is going to be completed by 2019, the project is so designed that it starts delivering the cash flow from FY2014 itself. The yearly capex will be around US$250 million.

Zinc International

Production Performance

In H1 FY 2013-14, total production of refined zinc and mined zinc-lead metal in concentrate (MIC) was lower due to disruptions at the Lisheen and Black Mountain Mines (BMM) in Q1. Production since then has stabilised and we expect to produce around 390,000 tonnes of refined zinc and mined zinc-lead metal in concentrate in FY 2013-14.

Unit Costs

(US$ per tonne)

Production costs marginally increased to US$1,122 per tonne compared to US$1,090 per tonne for the same period last year due to lower volumes in the first quarter in Lisheen and BMM and a reduction in ore grades.

Financial Performance

(in US$ million, unless otherwise stated)

EBITDA for H1 was US$117 million lower by 14%, primarily due to lower volume and LME zinc prices with marginal increase in cash costs.

Outlook

Overall, the strategy of the business is to increase the mine life through our exploration programme, alongside developing the Gamsberg project, where a feasibility study is being carried out. Gamsberg is a 186 mt zinc deposit, one of the largest undeveloped deposits in the world.

Oil & Gas

Production Performance

In H1, gross operated production reached 39.0 million barrels of oil equivalent (mmboe) with working interest production at 24.2 mmboe, 3% higher than the same period last year. The average daily gross operated production also increased by 3% to 212,873 barrels of oil equivalent per day (boepd) which was primarily driven by a 3% increase at the Rajasthan block and a 38% ramp-up in production at the Cambay block.

Development 

With the current production ramp up, Cairn India remains on track for its FY 2013-14 exit gross production target of over 225,000 boepd from all producing assets including over 200,000 boepd from the Rajasthan block.

During the quarter Cairn India made significant progress in terms of its three key drivers for production enhancement, viz Well Construction, Facility uptime & cost efficiency and Government/JV approvals. With the focus on cost optimisation and enhanced operational efficiencies, Cairn India maintained its field direct operating cost within US$ 3/boe for the quarter.

In the Rajasthan block, Cairn India received the partner approval for the Mangala polymer Enhanced Oil Recovery (EOR) project, for which the contracting is in advanced stages and full field implementation is expected to commence in FY2015. Further, we continue to focus on the low permeability reservoirs within the Barmer Hill formation through use of advanced technology in order to monetize the significant resources.

Further on the regulatory front, the government issued a policy on the Integrated Development Plan. The prime objective of the policy is to reduce the time consumed from discovery to production.

Market

(US$ per barrel)

The average crude oil price for the six months to September 2013 was 2% lower than during the same period last year. Rajasthan crude is well established in the market catering to strong demand from public and private sector refineries.

In accordance with the Rajasthan block Production Sharing Contract, the crude is benchmarked to Bonny Light, West African low sulphur crude that is frequently traded in the region, with appropriate adjustments for crude quality. The implied crude price realised for H1 FY 2013-14 (average of six months up to September 2013) lies within the stated guidance of 8%-13% discount to Brent.

The approval of operating partners been secured for implementation of the world's largest polymer Enhanced Oil Recovery (EOR) project in the Mangala Field. Technical alignment is also in place for Field Development Plans for the Barmer Hill, NI and NE fields.

Financial Performance

(in US$ millions, except as stated)

EBITDA for H1 was US$1,123 million lower by 13%, despite higher volumes mainly due to an increase in the share of profit petroleum charges from 20% to 30%, payable to the Government of India and marginally lower oil prices.

In Cairn India, the oil & gas reserve created on acquisition is amortised on a unit of production basis over the total estimated remaining commercial reserves. Unit of production is calculated as the ratio of oil & gas production in the period to the estimated quantities of commercial reserves. Commercial reserves are proven and probable (2P) oil & gas reserves, which are estimated quantities of crude oil, natural gas and natural gas liquids with a specified degree of certainty to be recoverable in future from known reservoirs and which are considered commercially producible.

Exploration

Cairn India is actively pursuing exploration and appraisal (E&A) activities in all its assets.

Cairn India has drilled 6 E&A wells in the RJ block in H1 FY14. Out of these, 4 wells found hydrocarbons. A Declaration of potential commerciality has been submitted for one of the discoveries. In Rajasthan, Cairn India plans to drill several high impact exploration wells to drill out 50% of the 530 million barrels of gross recoverable risked prospective resources by end FY 2013-14.

The appraisal drilling in the Krishna Godavari (KG-ONN- 2003/1) block witnessed three-fold productivity increase post successful drilling and fracking, significantly improving the commerciality of the Nagayalanka discovery. The Declaration of commerciality is expected to be submitted in this financial year. Cairn India also plans to drill an exploration well in the Ravva block within this financial year, in addition to further exploration activities in other blocks in the India, Sri Lanka and South Africa.

Outlook

Cairn India remains on track for our FY 2013-14 exit gross production target of over 225,000 boepd including over 200,000 boepd from the Rajasthan block. With the Mangala polymer EOR project securing partner approval, contracting is in advanced stages for full field implementation to follow this, with the aim of sustaining production and increasing the field's ultimate oil recovery. Focus is on the significant resources in the low permeability reservoirs within the Rajasthan Barmer Hill formation exploiting advanced technology to achieve optimal commercial rates, with infrastructure and development facilities in place.

Iron Ore

Production and Sales

The suspension of iron ore operations at Goa and Karnataka continued in Q2 FY 2013-14. Following the lifting of restriction on mining at Karnataka by the Supreme Court, we are now awaiting final statutory clearances to restart mining. We expect to resume mining at Karnataka soon. Regarding the suspension of mining in Goa, the Supreme Court has recently announced its interim order, allowing sale of inventory of iron ore. They have also mandated the setting up of an expert committee to determine how much mining should be permitted in the state of Goa. Following the commissioning of new capacity, the production of pig iron increased substantially, up by 97% to 238,000 tonnes.

Market

In 2013, world steel consumption is forecast to increase by 3 per cent, compared with 2012, to total 1.57 billion tonnes. The growth will be supported mostly by increased infrastructure construction activity in emerging economies, particularly in Asia.

China forecasts that it will increase its imports of iron ore by 12 per cent to total 831 million tonnes in 2013.

India's steel consumption forecast to increase 6 per cent to total 83 million tonnes. The increase in consumption is expected as a result of government spending on infrastructure projects and higher consumption of consumer durables.

Financial Performance

(in US$ million, except as stated)

Industry wide suspension of mining resulted in negative EBITDA in H1 FY 2013-14 at US$18 million (H1 FY 2012-13 positive US$117 million).

Projects

At Liberia, we have established by extensive drilling, contours of large iron ore deposits with further upside. We are reviewing the different phased options, including the first phase of 2 mt.

Outlook

Following the lifting of restriction on mining at Karnataka by the Supreme Court, we are now awaiting final statutory clearances to restart mining. The Supreme Court has recently announced its interim order, allowing sale of inventory of iron ore in the state of Goa.

Copper

Copper India/Australia

Production Performance

Following a temporary closure in Q1, post favourable order of National Green Tribunal, the smelter had restarted in end June and is now operating at full capacity. The copper anode production in Q2 was 90,000 tonnes, in line with the rated capacity. Copper cathode production was 82,000 tonnes in Q2 and 98,000 tonnes in H1.

Mined metal production in Australia was 12,000 tonnes during the first half of the year.

Market

Average LME copper price fell by 9% and Treatment charges/Refining charges (TC/RC) increased by 23% during the six months to September 2013 compared to the corresponding prior period.

Global refined copper production in H1 FY 2013-14 was 10.5mt and is expected to be 10.7mt in H2 projecting a total growth of 4.7% year on year. Global refined copper consumption is expected to grow by 5.6%. TC/RC terms are expected to rise in favour of smelters on the back of rising mine supply from brownfield and greenfield expansions.

Unit Cost

Net unit conversion cost at Copper India was 13.8 US cents per lb in H1 FY2013-14, compared with 6.3 US cents per lb in the H1 FY 2012-13, largely due to lower sulphuric acid by-product sale prices.

Financial Performance

(in US$ million, except as stated)

EBITDA for H1 was lower reflecting lower volumes due to the temporary plant closure in Q1 and lower sulphuric acid income.

The National Green Tribunal gave environmental clearance for our Tuticorin smelter and it became operational again following the temporary closure in the first quarter of the year.

Projects

The second unit of the 80MW power plant is awaiting consent and 400 ktpa copper smelter expansion project is on hold, pending consent from the State Pollution Control Board.

Outlook

We expect to operate smelter at full capacity in H2 2014. We expect improved profitability due to higher TC/RC in FY2014-15. The plant will undergo a bi-annual shutdown in the first half of the year FY 2014-15.

Copper Zambia

Production Performance

Mined metal production was lower at 34,000 tonnes in Q2 FY 2013-14 and 70,000 tonnes in H1 mainly due to the suspension of mining operations at the COP F&D mine in Zambia from January 2013, which was partially offset by higher output from the Tailings Leach Plant (TLP). Integrated production was lower in H1 due to furnace leakage in the Nchanga smelter in Q1.

Unit Costs

Unit cash costs of integrated production in H1 FY 2013-14 were 228 US cents per lb, in line with the same period last year.

Financial Performance

(in US$ million, except as stated)

EBITDA in H1 FY 2013-14 was US$101 million, 45% lower than the EBITDA of US$185 million in H1 FY 2012-13, primarily due to lower volumes and LME prices.

Outlook

KCM is facing challenges to improve production and control the cost of production for which we are engaging ourselves with the stakeholders and cost control measures are being taken. Our key focus at the Zambian operations would be to improve the operational performance and rationalising the cost base which are required to make the operations sustainable and realise potential of the assets. We expect to deliver 140,000 tonnes of integrated production volume in the current financial year and achieve costs of around 220 US c/lb in H2 FY 2013-14.

Aluminium

Production and Sales

The Lanjigarh alumina refinery recommenced operations in July 2013 and produced 116,000 tonnes in Q2. During Q2, the refinery supplied 17% of the alumina consumed by our smelters as compared with 100% use of imported alumina feed by the smelters in Q1. We expect the refinery to ramp-up to its rated capacity 1mtpa in Q3 FY2014.

In Q2, the Jharsuguda-I and Korba-II smelters continued to operate above their rated capacities. Around 60% of the total production was converted into value added products in Q2, in line with the corresponding prior period.

Market

Average LME prices for aluminium for the six months to September 2013 were US$1,807, a decline of 7% from the average price level during same period last year (H1 FY 2013-14 US$1,947). Tightness in physical market had led to an increase of US$ 140 (benchmark) in the premium in H2 FY 2013, even though it has come off somewhat in Q2, it is strong and expected to stay steady. Global primary aluminium consumption however, is expected to be 50.4 million tonnes in FY 2013-14, a growth of 6.6% year-on-year. Aluminium is expected to continue to lead the metals pack in term of consumption growth rates.

Unit Costs

(in US$ per tonne)

1. Smelting cost comprises production cost excluding alumina cost.

Alumina COP for at Lanjigarh was US$ 329 per tonne as compared to US$ 340 per tonne in H1 FY 2013.

We continue to improve our cost performance and maintain our position is second quartile of global cost curve, despite purchased alumina and bauxite. At Jharsuguda, aluminium COP was lower due to improved coal sourcing mix and operational efficiencies partially offset by higher alumina cost. At BALCO, aluminium COP was higher on account of higher alumina cost and further tapering of coal linkage, partially offset by lower specific power consumption and other operational efficiencies.

Financial Performance

(in US$ million, except as stated)

EBITDA increased by 25% at US$125 million as compared to US$101 million generated in H1 FY 2012-13 due to lower cost of production and improved operational efficiency despite a decrease in LME prices.

Expansion Project

We continue to evaluate the potential start-up date of the 1.25 million tonnes smelter at Jharsuguda. We are currently working on completing the project.

We expect to tap first metal at the 325 ktpa BALCO-III Aluminium smelter in Q3 FY2014. The first unit of the 1200 MW Power plant at BALCO is expected to be synchronized in Q4 FY2014. On receipt of remaining regulatory clearances, we expect to commence mining at our BALCO coal block in Q1 FY2015.

Outlook

In H2 we expect stable output from the existing Jharsuguda and BALCO smelters and the weighted average cost of aluminium is expected to remain stable and in lower half of global cost curve. Higher alumina output from the Lanjigarh refinery, which recommenced operations in July 2013, will therefore help reduce cost.

Power

Production and Sales

* Includes SEL trial run production of 339 million units in H1 FY 2013.

Power sales were lower at 5,087 million units in H1 as compared to 5,364 million units in the corresponding previous period. Higher power sales from Jharsuguda 2,400MW power plant which was operating at a reduced Plant Load Factor (PLF) was more than offset by lower sales at BALCO 270MW power plant. The lower PLF at Jharsuguda and BALCO 270MW was largely due to lower demand.

Market

The last five years have witnessed more than 23,000 MW of Independent Power Producers (IPP) capacity addition, not only exceeded the Government target but also adding more than the total capacity in the fifteen years preceding it. With economic growth falling below 5%, the power sector is seeing sharp slowdown in demand. The poor financial health of the distribution companies have further worsened the power tariff. However, in run up to the elections and peak season the lower tariff is expected to rise.

Unit Costs

Average power generation costs in H1 FY 2013-14 were 3.9 US cents per unit compared with 4.2 US cents per unit in H1 FY 2012-13.

Financial Performance

(in US$ million, except as stated)

Note- Revenue includes US$17.9 mn to Balco smelter in H1 FY 2013-14, US$ 7.0 mn in H1 FY 2012-13 and US$ 9.9 mn in FY 2012-13.

EBITDA in H1 FY 2013-14 was US$123 million, marginally lower than the previous year largely due to lower power sales volume.

Projects

Work at the Talwandi Sabo power project is progressing well and the first unit is expected to be synchronised in Q3 FY 2013-14.

Outlook

We expect 50% PLF at 2400MW IPP in the second half of the year which will improve power sale. However, in run up to the elections and peak season the lower tariff is expected to rise.

Going Concern

The directors have considered the Group's cash flow forecasts for the period to the end of 31 March 2015. The Board is satisfied that the Group's forecasts and projections, taking into account reasonably possible changes in trading performance, show that the Group will be able to operate within the level of its current facilities for the foreseeable future. For this reason the Group continues to adopt the going concern basis in preparing its Condensed financial statements. Further analysis of net debt is set out in note 9 of the interim financial statements and details of borrowings and facilities are set out in the Financial Review on page 14-15.

Risks and Uncertainties

The Vedanta Group is exposed to a variety of risks which are inherent in an international mining and resources business. Manifestation of any or all of these risks could have a significant impact on the operational or financial performance of our Group.

Principal risks and uncertainties and detailed information on the impact of these risks as well as the identification and mitigation measures adopted by management have been documented in Vedanta's Annual Report for FY 2012-13. A summary of these risks and their possible impact is presented below:

Responsibility Statement

We confirm that to the best of our knowledge:

n The condensed set of financial statements has been prepared in accordance with IAS 34, Interim Financial Reporting; and give a true and fair view of the assets, liabilities, financial position and profit of the undertakings included in the consolidation as a whole by DTR 4.2.4R

n The interim management report includes a fair view of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

n The interim management report includes a fair view of the information required by DTR 4.2.8R (disclosure of related party transactions and changes therein)

By order of the Board

M S Mehta D D Jalan

Chief Executive Officer Chief Financial Officer

14 November 2013 14 November 2013

CONDENSED CONSOLIDATED INCOME STATEMENT

For the six month period ended 30 September 2013

(US$ million except as stated)

* The comparative information has been restated so as to reflect the adoption of new accounting standards, details of which have been set out in note 12.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six month period ended 30 September 2013

(US$ million)

* The comparative information has been restated so as to reflect the adoption of new accounting standards, details of which have been set out in note 12.

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 September 2013

(US$ million)

* The comparative information has been restated so as to reflect the adoption of new accounting standards, details of which have been set out in note 12.

Financial statements of Vedanta Resources plc, registration number 4740415 were approved by the Board on 14 November 2013.

MS Mehta- Director

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

For the six month period ended 30 September 2013

(US$ million)

* The comparative information has been restated so as to reflect the adoption of new accounting standards, details of which have been set out in note 12.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the period ended 30 September 2013

(US$ million)

For the year ended 31 March 2013:

(US$ million)

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)

For the period ended 30 September 2012

(US$ million)

* The comparative information has been restated so as to reflect the adoption of new accounting standards, details of which have been set out in note 12.

1 Other reserves comprise the currency translation reserve, merger reserve, investment revaluation reserve and the general reserves established in the statutory accounts of the Group's Indian subsidiaries. Under Indian law, a general reserve is created through an annual transfer of net income to general reserves at a specified percentage in accordance with applicable regulations. The purpose of these transfers is to ensure that the total dividend distribution is less than the total distributable results for that year.

Notes to the financial information

1. Basis of Preparation

The Condensed financial statements for the six month period ended 30 September 2013 have been prepared in accordance with International Accounting Standard (IAS) 34 Interim Financial Reporting as adopted by the European Union ('EU') and the requirements of the Disclosure and Transparency Rules (DTR) of the Financial Conduct Authority (FCA) in the United Kingdom as applicable to interim financial reporting.

The Condensed financial statements represent a 'condensed set of financial statements' as referred to in the DTR issued by the FCA. Accordingly, they do not include all of the information required for a full annual financial report and are to be read in conjunction with the Group's financial statements for the year ended 31 March 2013, which were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by EU. The financial statements for the period ended 30 September 2013 and 30 September 2012 do not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The financial information for the year ended 31 March 2013 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. This information was derived from the statutory accounts for the year ended 31 March 2013, a copy of which has been delivered to the Registrar of Companies. The auditor's report on these accounts was unqualified, did not include a reference to any matters to which the auditor drew attention by way of an emphasis of matter and did not contain a statement under sections 498 (2) or (3) of the Companies Act 2006.

The financial information prepared under IFRS in respect of six months ended 30 September 2013 and 30 September 2012 are unaudited but has been reviewed by the auditor and their report is set out on page 62.

The Group published full financial statements that comply with IFRS as adopted by the European Union for the year ended 31 March 2013.

The set of financial statements included in the interim financial report has been prepared using the going concern basis of accounting for the reasons set out in the Going Concern section of the Financial Review.

2. Accounting Policies

The condensed consolidated financial statements are prepared using the same accounting policies as applied in the audited 31 March 2013 annual report. However, during the interim period the following new standards, amendments to existing standards and interpretations have become applicable and adopted for preparation of the condensed consolidated financial statements.

IAS 1: Presentation of items of other comprehensive income (Amended)

This amendment to IAS 1 requires entities to separate items presented in other comprehensive income that can be recycled in the income statement at a future period separately from items that will not be recycled in a future period together with their tax effect. This amendment has been applied retrospectively and affected the presentation of items of comprehensive income and had no impact on the financial performance of the Group.

IAS 19: Employee benefits-(Revised)

The revised IAS 19 standard on employee benefits has introduced amendments to the accounting for defined benefit plans. It requires all actuarial gains and losses arising on defined benefits plans to be recognised immediately in other comprehensive income and requires the expected return on plan assets which is recognised in the income statement to be calculated based on the rate used to discount the defined benefit obligation. This differs from the Group's previous policy which was to charge any actuarial gain/losses in the income statement. Hence the Group has recognised all actuarial gains and losses arising on defined benefits plans in other comprehensive income.

The Group has applied the standard retrospectively in accordance with the transitional provisions. The adoption the amendment in IAS 19 has not materially impacted the financial statement. The impact on the half-year financial statements is set out in note 12.

IFRS 7: Disclosure-Offsetting financial assets and financial liabilities

IFRS 7 requires additional disclosures in connection with assets and liabilities which are offset under a master netting agreement. The amendments to IFRS 7 have not impacted the Group's half-year financial statements.

IFRS 10: Consolidated financial statements

IFRS 10 establishes the principal for the preparation and presentation of consolidated financial statements with a new definition of control based on power to direct the activities of the investee, replacing previous guidance on control and consolidation under IAS 27 (Separate Financial Statements) and SIC 12 (Consolidation-Special Purpose Entities). IFRS 10 does not have any impact on the financial statements of the Group.

IFRS 11: Joint arrangements

IFRS 11 (Joint Arrangements) replaced IAS 31 (Interest in Joint Ventures) and requires investments in joint arrangements classified as either joint ventures or joint operations based on the rights and obligations of the parties to the arrangement. The standard removes the option to account for joint ventures using proportionate consolidation and instead joint arrangements that meet the definition of a joint venture under IFRS 11 must be accounted for using the equity method. IFRS 11 has not significantly affected the Group.

IFRS 12: Disclosure of interest in other entities

IFRS 12 applies to entities that have an interest in a subsidiary, a joint arrangement, an associate or unconsolidated structured entities. IFRS 12 requires an entity to disclose information that enables users of financial statements to evaluate the nature and risk associated with the interest in other entities. These disclosure requirements are not applicable for consolidated financial statements, unless required as a result of significant events and transactions in the period. Accordingly these disclosures will be provided in the Group financial statements for the year ending 31 March 2014.

IFRS 13: Fair value measurement:

IFRS 13 provides for a framework for measuring fair value when such measurements are required or permitted by other standards. IFRS 13 also results in an amendment to IAS 34 requiring that some of these disclosures relating to financial instruments are made in the financial statements and also requires specific disclosures on fair values. These disclosures replace some of the existing disclosure requirements in other standards, including IFRS 7 Financial Instruments: Disclosures. The application of IFRS 13 has not materially affected the fair value measurements carried out by the Group.

IFRIC 20: Stripping Costs in the Production Phase of a Surface Mine

IFRIC 20 specifies the accounting for costs associated with waste removal (stripping) during the production phase of a surface mine. When the benefit from the stripping activity is realised in the current period, the stripping costs are accounted for as the cost of inventory. When the benefit is the improved access to ore in future periods, the costs are recognised as a non-current asset, if certain criteria are met. After initial recognition, the stripping activity asset is depreciated on a systematic basis (unit of production method) over the expected useful life of the identified component of the ore body that becomes more accessible as a result of the stripping activity.

As a result of adoption of IFRIC 20, the two key changes to the Group's existing accounting policy is upon initial recognition of the stripping assets and its depreciation based on unit of production basis compared to recognising it in the income statement as is currently done. Accordingly, the application of IFRIC 20 has resulted in increased capitalisation of stripping costs and its depreciation and consequential adjustment to the cost of sales and inventories. Comparatives numbers have been restated to give the retrospective impact of adopting IFRIC 20. The impact on the Group financial statements is set out in note 12.

Foreign Exchange Rate

The following exchange rate to US dollar ($) have been applied:

3. Segmental Reporting

The Group's primary format for segmental reporting is based on its business segments. The business segments consist of zinc, oil and gas, iron ore, copper, aluminium and power with components not meeting the quantitative threshold for reporting being reported as "Others". Business segment financial data includes certain corporate costs, which have been allocated on an appropriate basis. The risks and returns of the Group's operations are primarily determined by the nature of the different activities in which the Group is engaged. Inter-segment sales are charged based on prevailing market prices. The Group's activities are organised on a global basis.

Vedanta Resources plc is company incorporated in the United Kingdom under the Companies Act. The Group's reportable segments defined in accordance with IFRS 8 are as follows:

n Zinc-India

n Zinc-International

n Oil and gas

n Iron Ore

n Copper-India/Australia

n Copper-Zambia

n Aluminium

n Power

Management monitors the operating results of reportable segments for the purpose of making decisions about resources to be allocated and for assessing performance. Segment performance is evaluated based on the EBITDA of each segment.

The following tables present revenue and profit information and certain asset and liability information regarding the Group's reportable segments for the six months ended 30 September 2013 and 30 September 2012 and for the year ended 31 March 2013. Items after operating profit are not allocated by segment. Power segment now includes BALCO 270 MW power plant, which was earlier part of the Aluminium segment. The reclassification has been done as the power generated from the 270 MW power facility is being largely sold to third parties as opposed to being used internally. Accordingly numbers for the prior periods have been regrouped.

(a) Reportable Segments

Period ended 30 September 2013

(US$ million)

1 EBITDA is a non-IFRS measure and represents operating profit before special items, depreciation and amortisation.

2 Depreciation and amortisation is also provided to the chief operating decision maker on a regular basis.

Period ended 30 September 2012 (restated)

(US$ million)