Vedanta Limited - Future Natural Resource Leader

https://www.business-standard.com/companies/news/vedanta-s-parent-may-sell-1-billion-worth-shares-to-gqg-partners-report-124021401662_1.html

Vedanta Resources, the parent of Indian miner Vedanta Ltd, may sell about $1 billion worth shares in the company to investment firm GQG Partners via block deals, television channel ET Now reported on Wednesday citing sources.

Vedanta did not immediately respond to a Reuters request for comment.

Saddled with $6.4 billion in outstanding debt, including a $4.5 billion payment due by fiscal 2025, Vedanta Resources has been attempting to shore up its finances, including through a recent debt restructuring.

Group Chairman Anil Agarwal has made several bids to trim debt, including an unsuccessful attempt to take the company private in 2020 and plans to split Vedanta into six companies.

$1B stake sale by the promotors may help pare some debt, but as you mentioned more would be required since approx 4.5B$ of debt is maturing by March 2025!

Also the recent statement by SC that the copper smelter in Tuticorin is a National Asset and hence needs to be restarted soon is a big positive!

Technical Analysts also seem to be liking

https://x.com/Sahilpahwa09/status/1754912932972933535?s=20

1 Like

It seems there was no GQG Partners in trade today at Vedata counter; the stake sale by the Promotor group entity, Finsider International was through Open Market.

I find this very interesting:

No. of Shares
Vedanta 3,71,72,06,239
HindZinc 4,22,53,19,000
Vedanta Holding in HindZinc 2,74,31,54,310
HindZinc Price 721
HindZinc M’Cap 3046454999000
Vedanta’s Value 1977814257510
Value Per Share for Vedanta 532
8 Likes

Does Vedanta think that their debt doesn’t pose a big risk in future post the demerger and are hence distributing such hefty dividends?

Are the hefty dividends in recent years aimed at boosting investors/bond holder confidence in the fiscal strengths of their organization?

Answer to your last question is an obvious Yes.

2 Likes

Dividends is the way of rewarding shareholders with real cash. (Not rewarding to salaried at higher tax bracket though). The promoter is a big shareholder, so inherently he benefits from it.
Privatize the profits socialize the losses - mantra of capitalism.

3 Likes

Vedanta paying heavy dividend was to cover interest cost of parent company …as parent company has huge debt…

4 Likes

Found this on Youtube, would love members’ opinion on the de-merger if you’re tracking :