LONDON -- The shares of Vedanta (LSE:VED) jumped 2% to 1,280 pence during early London trade this morning after the Indian mining giant revealed record annual production of zinc-lead, silver, oil and gas.

The company's full-year revenues advanced 7% to $15 billion, driven by a 19% uplift in oil and gas production. This segment was boosted by Vedanta's 2011 acquisition of Cairn India, and a 32% recovery in output at the company's Rajasthan block.

Vedanta reported a 39% increase in cash generated from operations to almost $5 billion, with free cash flow of $1.5 billion.

Reflecting this rise in profits, the company proposed a 6% increase in its final dividend, bringing Vedanta's total annual payout to $0.58 per share.

Vedanta's founder and long-standing Chairman Anil Agarwal added:

Vedanta has once again delivered a strong performance. Operationally, the group has seen great success, with oil and gas production up 19%, exploration recommencing in Rajasthan, and a successful discovery at the block in April.

The group also achieved strong growth across copper, aluminum, lead and sliver, maintaining our position as a large global diversified natural resources company. We delivered positive free cash flow of $1.5 billion after growth capex, and have maintained progressive dividends.

With a market cap of £3.4 billion, Vedanta's shares trade at 17 times expected earnings. After today's dividend hike, the shares offer a trailing dividend yield of around 3%.

Of course, whether that valuation, today's results and the future prospects for the outsourcing industry all combine to make shares of Vedanta a 'buy' remains your decision.

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