Lloyds Metals FY26: Record Scale, Rising Value Addition, and a New Copper Chapter

Lloyds Metals and Energy Limited closed FY26 with its strongest financial and operating performance on record. On a consolidated basis, total income reached INR 17,306.4 crore in FY26, up sharply from the prior year, supported by a step-change in mining volumes, a fast ramp-up in pellets, and the consolidation of MDO and services through Thriveni Earthmovers and Infra Private Limited (TEIPL). EBITDA expanded to INR 6,333.9 crore with an EBITDA margin of 36.60%, and PAT stood at INR 3,828.6 crore.

Standalone performance was also at a new peak. Total income was INR 13,837.8 crore, EBITDA was INR 4,673.1 crore, and PAT was INR 3,194.3 crore. Importantly, the company’s narrative across the investor presentation and management commentary is consistent: FY26 was built on operating leverage, product mix improvement, and logistics-led cost advantages.

A year defined by volume scale and better mix

The biggest operating driver was iron ore. The company reported FY26 iron ore production of 21.96 million tonnes, with Q4 production of 9.09 million tonnes. On the sales side, iron ore sales volumes were 16.18 million tonnes for FY26. Realisations were reported at INR 5,806 per tonne for FY26, while EBITDA per tonne stood at INR 1,930.

What changed meaningfully through FY26 was the contribution from value added products. Standalone revenue mix for FY26 shifted to 32% value added products versus 20% in FY25, while EBIT contribution from value added products rose to 30% from 11%. The key reason was the ramp-up of the pellet plant, which began commercial production towards the end of Q2 FY26 and achieved 100% capacity utilisation within four months. In FY26, pellet production was 3.03 million tonnes, and the company reported FY26 pellet realisation of INR 10,277 per tonne with EBITDA per tonne of INR 4,657.

DRI volumes also grew, with FY26 DRI sales at 480 thousand tonnes and reported EBITDA per tonne at INR 6,643 for FY26.

Financial snapshot

Consolidated diversification via TEIPL and MDO services

A key structural change in the consolidated mix is the inclusion of TEIPL. The presentation’s consolidated revenue split for FY26 shows iron ore at 36%, value added products at 26%, and MDO and services at 38%. This is a major shift from FY25 where the company shows consolidated split primarily between iron ore and value added products.

TEIPL reported FY26 total income of INR 7,996.9 crore and EBITDA of INR 2,053.6 crore, with an EBITDA margin of 25.68% (as presented, excluding a one-time fair value loss on CCPS financial liability). Net debt (including RPS) for TEIPL as on 31 March 2026 was INR 5,373.4 crore.

The operating updates around TEIPL also highlight scale-up efforts in India mining services, including environmental capacity expansion at Surjagarh mines from 10 MTPA to 55 MTPA and multiple projects across Odisha and coal operations.

Logistics and cost agenda: slurry pipeline as the backbone

A recurring theme is evacuation and structural logistics advantage. The company has already commissioned an 85 km slurry pipeline from Hedri to Konsari, referenced as 10 MTPA. It is also planning a larger integrated slurry and stockyard corridor. The investor presentation and concall both link these investments to meaningful freight savings.

The presentation states cost savings of INR 800 to 1,000 per tonne for Hedri to Ghugus, and additional savings of INR 250 per tonne via a Chandrapur stockyard for external sales. Management also stated that annual savings are expected to surpass INR 2,000 crore per annum as logistics and sustainability initiatives mature by March 2028.

FY27 guidance: higher pellets, higher DRI, and entry into steel

Management provided explicit FY27 operational guidance:

• Iron ore production: 26 million tonnes
• Pellet production: 7.75 to 8.0 million tonnes
• DRI production: 825 thousand tonnes
• Steel (WRM) production: 0.15 to 0.2 million tonnes

The pellet step-up is supported by the commissioning of the second pellet plant in May 2026, taking total pellet capacity to 8 million tonnes per annum. Management also discussed potential debottlenecking as an aspiration, subject to permissions, though it did not provide formal guidance for a higher capacity.

The steel entry is positioned as the next stage of integration. The presentation indicates a 1.2 million tonne wire rod mill project under the downstream roadmap, and management highlighted that construction has started and the project is expected to remain on time.

DRC copper and cobalt: operational start and expansion intent

FY26 also marks the company’s formal entry into the DRC copper value chain. The investor presentation states that LMEL commenced commercial production in March 2026 from a 12,000 TPA SX-EW plant at Surya Mines, and that LMEL has acquired a 50% interest in the platform.

The company presented calendar year production estimates of 10,000 tonnes in CY 2026 and 15,000 tonnes in CY 2027, with a defined pathway to expand Surya capacity to 30,000 TPA and a longer-term ambition of 100,000 TPA in 3 to 5 years.

In addition, the company disclosed acquisition of a 49% stake in Chemaf Group, which provides copper-cobalt exposure. The presentation notes cobalt scale-up from 4,000 TPA at Etoile to 16,000 TPA at Mutoshi, taking total cobalt capacity to around 20,000 TPA.

Management commentary added two important details. First, Surya had produced around 700 to 750 tonnes of copper as of the call date, and the ramp-up was constrained by sulphuric acid supply shortages. Second, the Chemaf platform requires incremental capex. Management indicated that the overall plant capex was around USD 1.1 billion with more than USD 800 million already spent, and that completion plus initial working capital and mine development may require USD 200 to 260 million.

The discussion also acknowledged the capital structure complexity. Management said Chemaf had around USD 800 million of debt, with negotiated settlements expected to reduce it materially, leaving around USD 330 million as non-recourse at the Chemaf level.

Corporate actions and funding stance

The board approved a final dividend of Re. 1 per share (100% on face value Re. 1) for FY26, subject to shareholder approval. The company also approved enabling resolutions for issuance of non-convertible debentures, including an approval for up to INR 700 crore and an enabling approval for up to INR 2,500 crore in one or more tranches.

Management’s stated leverage approach is to keep debt at around 1 to 1.5 times EBITDA. On the concall, management indicated no near-term equity raising plans, with any potential equity event discussed only in the context of a future Thriveni IPO.

Takeaways for investors

Lloyds Metals exits FY26 with three visible pillars. The first is mining scale, demonstrated by the iron ore ramp from 10 million tonnes to 22 million tonnes in one year. The second is value addition, led by pelletisation and downstream integration, with FY27 guidance pointing to a significant rise in pellet and DRI output and an initial step into steel.

The third pillar is an expanding strategic footprint through copper and cobalt in the DRC. While the ambition is clear and the assets are positioned as near-operational, the ramp-up is dependent on execution, supply-chain stability, and disciplined capital deployment. The company’s FY27 capex expectations remain high, and consolidated leverage has already risen.

The next twelve to eighteen months will therefore be judged less by the strength of FY26 results, and more by whether the company can deliver the guided FY27 volumes, bring steelmaking online as planned, and move the DRC copper platforms from early production into stable, repeatable operations.