Anil Agarwal likely to sell a 2.5% stake in Vedanta Ltd: Report

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Mining Mogul Anil Agarwal-controlled Vedanta Resources is planning to sell off a 2.5% stake in Vedanta Ltd through block deals in July. The promoter group is likely to sell about 9 crore shares to raise around Rs 4,000 crore through block deals, a report in the Economic Times said.

At the end of FY24 (March 31, 2024), Vedanta’s promoters held a 61.95% stake in the company, down from 63.71% stake in December 31, 2023. In February this year, promoters had sold some stake in a block deal that was valued at over Rs 2,615 crore.

In February this year, Finsider International, which is part of Vedanta Resources, sold more than 6.55 crore Vedanta shares for Rs 1,700 crore. The shares were sold at Rs 265.14 apiece.

Starting December 2022, Vedanta’s promoter shareholding has declined from nearly 70% to just over 60%.

Earlier this week, Vedanta Resources said it will seek to cut its debt by $3 billion over the next three years. In its annual report, Agarwal said “We seek to further deleverage Vedanta Resources by $3 billion over the next three years.”

Vedanta Resources has been grappling with a host of rating downgrades since last year as analysts flagged liquidity issues and high default risk.

In the last two years, Vedanta Resources has cut its debt by $3.70 billion.

Agarwal said the maturity of its outstanding bonds worth $3.20 billion, extended up to fiscal 2029, has provided it with “newfound liquidity”. The group will use this liquidity to fund “important capex projects,” he added.

Vedanta Ltd, which is in the middle of a planned demerger, aims to operationalise coal blocks and expand capacities for its steel and aluminium business and has proposed to set aside $1.90 billion as capital expenditure for fiscal 2025.

This fiscal so far, the Vedanta Group, which includes Vedanta Ltd and Hindustan Zinc Ltd, has produced most wealth for its stock market investors, with combined market valuation growing by Rs 2.2 lakh crore. The Vedanta Group’s market value increased by more over Rs 2.2 lakh crore between March 28 and June 20, 2024, according to stock exchange statistics shared by PTI.

According to stock exchange data, it has been observed that the share prices of Vedanta and Hindustan Zinc have demonstrated remarkable growth, having doubled from their 52-week lows. This uplifting trend can be attributed to several favorable factors, including the impending demerger, the consistent focus of management on restructuring initiatives, and a discernible uptick in profitability.

In a divergent scenario, the market capitalization of the Adani and Mahindra groups has surged by Rs 1.4 lakh crore each. Meanwhile, during the same period, the market valuation of heavyweight RIL witnessed a notable decline by more than Rs 20,656.14 crore. In contrast, the market cap of the Tata Group experienced a significant surge, escalating by over Rs 60,600 crore.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.



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