Vedanta shares 2% rise on demerger buzz, snap 6-day losing run. Key details
Vedanta, which had 15.28 lakh retail investors as of June 30, climbed 1.96 per cent to hit a high of Rs 213.05 on BSE. The scrip is down 33 per cent year-to-date.
- Sep 28, 2023,
- Updated Sep 28, 2023 10:07 AM IST
Shares of Vedanta Ltd climbed 2 per cent in Thursday's trade amid a report suggesting the metals & mining company was looking to demerge its businesses into several separate listing entities. The stock had fallen in six previous trading sessions amid mounting concerns over London-listed Vedanta Resources debt restructuring, with credit rating agency Moody's slashing its credit rating for the parent citing elevated risks.
A fresh report by Bloomberg suggested that the company was nearing a deal to demerge businesses such as oil and gas, iron ore, aluminium and steel businesses into several listed entities. As per the report, it is hoped that a successful broad restructuring would help Anil Agarwal manage his group's debt load.
Vedanta, which had 15.28 lakh retail investors as of June 30, climbed 1.96 per cent to hit a high of Rs 213.05 on BSE. The scrip is down 33 per cent year-to-date.
Moody's this week warned that it could further downgrade Vedanta Resources ratings if the parent fails to make progress on funding arrangements to service its debt such that the risk of default increases materially higher than indicated by the current ratings.
Vedanta Resources has already pledged its entire share holding in Vedanta and their share of 64 per cent in Hindustan Zinc, Deven Choksey, Managing Director of KRChoksey Shares and Securities said.
"Therefore, it has limited ability to demerge other units given the charge of creditors on cash generating assets, particularly of Hindustan Zinc," he noted.
It would be a mistake, said Choksey, not to tap equity investor at this stage since there is significantly large appetite for india investment by global investors.
Shares of Vedanta Ltd climbed 2 per cent in Thursday's trade amid a report suggesting the metals & mining company was looking to demerge its businesses into several separate listing entities. The stock had fallen in six previous trading sessions amid mounting concerns over London-listed Vedanta Resources debt restructuring, with credit rating agency Moody's slashing its credit rating for the parent citing elevated risks.
A fresh report by Bloomberg suggested that the company was nearing a deal to demerge businesses such as oil and gas, iron ore, aluminium and steel businesses into several listed entities. As per the report, it is hoped that a successful broad restructuring would help Anil Agarwal manage his group's debt load.
Vedanta, which had 15.28 lakh retail investors as of June 30, climbed 1.96 per cent to hit a high of Rs 213.05 on BSE. The scrip is down 33 per cent year-to-date.
Moody's this week warned that it could further downgrade Vedanta Resources ratings if the parent fails to make progress on funding arrangements to service its debt such that the risk of default increases materially higher than indicated by the current ratings.
Vedanta Resources has already pledged its entire share holding in Vedanta and their share of 64 per cent in Hindustan Zinc, Deven Choksey, Managing Director of KRChoksey Shares and Securities said.
"Therefore, it has limited ability to demerge other units given the charge of creditors on cash generating assets, particularly of Hindustan Zinc," he noted.
It would be a mistake, said Choksey, not to tap equity investor at this stage since there is significantly large appetite for india investment by global investors.