Vedanta shares Q4 business updates, stock hits 52-week high; what's next?
Vedanta shares rose 4.67% to a 52-week high of Rs 312.50 in early deals. In terms of returns, the stock fell 28.11% in two years and rose 7% in a year.
- Apr 4, 2024,
- Updated Apr 5, 2024 2:33 PM IST
Shares of metal and mining major Vedanta Ltd hit their 52 week high in early deals today as the firm said it delivered highest ever annual volume across key businesses. The shares of Anil Agarwal-led firm rose 4.67% to a 52-week high of Rs 312.50 in early deals. In terms of returns, the stock fell 28.11% in two years and rose 7% in a year. In five years, the stock has climbed 61.90%.The stock hit a 52-week high of Rs 308 on April 3, 2024 and Rs 301.90 on April 2, 2024.
Aluminium business
Vedanta said alumina production at Lanjigarh Refinery rose 18% (yoy) to 484 kt in Q4 and 3% (qoq) driven by better operational performance. The cast metal aluminium production at the firm's smelters climbed 4% year-on-year to 598 kt.
In FY24, alumina production at Lanjigarh refinery climbed 1% (YoY) at 1,813 kt. The metal firm also logged its highest ever cast metal aluminium production of 2,370 kt, rising 3% YoY at its smelters.
Zinc business
In India business, mined metal production came at 299 kt in Q4, up 11% QoQ, driven by mix of improved mined metal grades and higher ore production across mines. The firm also logged highest-ever quarterly refined metal production at 273 kt, up 6% QoQ on account of better plant availability and up 1% YoY. Refined zinc production came at 220 kt, up 9% QoQ & 2% YoY. Refined lead production at 53 kt was lower 2% YoY and 5% QoQ.
Oil and Gas business
In oil and gas business, average gross operated production came at at 117.8 kboepd in Q4. Rajasthan block’s average gross production was lower by 6% QoQ and by 13% YoY at 97.8 kboepd. Gross production from Development Area-1 (DA-1), Development Area-2 (DA-2) and Development Area-3 (DA-3) averaged 84.8 kboepd, 12.9 kboepd and 0.1 kboepd; respectively. The natural decline in the MBA fields has been partially offset by infill wells brought online in Mangala, Aishwariya and Raageshwari Deep Gas (RDG) fields.
Iron Ore business
Karnataka Iron Ore
Saleable ore production rose 13% to 1.7 million tonnes, in Q4 and 23% QoQ due to improved operational efficiency and process improvement. Pig Iron production rose 6% at 198 kt, up 6% YoY, driven by improved process efficiency resulting in increased production, partially offset by shutdown of small furnaces.
Steel Business
Total saleable production fell 11% YoY to 343 kt in Q4 in line with lower hot metal production.
Stock outlook
Riyank Arora, Technical Analyst at Mehta Equities said, “Metal stocks witnessed good profit booking during the latter half of the day as stocks saw some profit booking coming in at higher levels. Technically, Vedanta has touched a major resistance mark of Rs 301.00 on its weekly charts and is showing signs of healthy profit booking. We advise investors to lock in their trading gains here and wait for a dip towards Rs 282 – Rs 285 for any fresh buying positions on the stock.”
Brokerage Nuvama is bullish on the stock with a target price of Rs 394. It has revised its earlier target of Rs 371.
“Management has guided for USD in debt reduction at Vedanta Resources by FY27 without any incremental debt at Vedanta Ltd. The monetisation of steel and iron ore assets by Q1FY25E (expect $2 bn) shall act as a first step. Moreover, we expect a DPS of Rs 40 each in FY25E and FY26E. Reiterate 'BUY' with a target price of Rs 394 (earlier Rs 371),” said Nuvama.
Aditya Gaggar, Director of Progressive Shares said, "Consolidation of 9 months comes to an end with a Cup and Handle formation breakout in the stock which was confirmed with an above average Volume. Leading oscillator RSI replicates the price pattern while MACD has already given a positive crossover. From the ADX, +DMI has crossed -DMI which is considered a buy signal. As per the pattern breakout, the target is Rs 366."
Abhijeet from Tips2trades said, "Vedanta stock price looks bullish but also overbought on the daily charts with next resistance at Rs 311. Investors should keep booking profits as a daily close below the support of Rs 297 could lead to target of Rs 265 in the near term."
Vedanta Ltd is a subsidiary of Vedanta Resources Ltd and has operations in oil and gas, zinc, lead, silver, copper, iron ore, steel, and aluminium and power across India, South Africa and Namibia.
Shares of metal and mining major Vedanta Ltd hit their 52 week high in early deals today as the firm said it delivered highest ever annual volume across key businesses. The shares of Anil Agarwal-led firm rose 4.67% to a 52-week high of Rs 312.50 in early deals. In terms of returns, the stock fell 28.11% in two years and rose 7% in a year. In five years, the stock has climbed 61.90%.The stock hit a 52-week high of Rs 308 on April 3, 2024 and Rs 301.90 on April 2, 2024.
Aluminium business
Vedanta said alumina production at Lanjigarh Refinery rose 18% (yoy) to 484 kt in Q4 and 3% (qoq) driven by better operational performance. The cast metal aluminium production at the firm's smelters climbed 4% year-on-year to 598 kt.
In FY24, alumina production at Lanjigarh refinery climbed 1% (YoY) at 1,813 kt. The metal firm also logged its highest ever cast metal aluminium production of 2,370 kt, rising 3% YoY at its smelters.
Zinc business
In India business, mined metal production came at 299 kt in Q4, up 11% QoQ, driven by mix of improved mined metal grades and higher ore production across mines. The firm also logged highest-ever quarterly refined metal production at 273 kt, up 6% QoQ on account of better plant availability and up 1% YoY. Refined zinc production came at 220 kt, up 9% QoQ & 2% YoY. Refined lead production at 53 kt was lower 2% YoY and 5% QoQ.
Oil and Gas business
In oil and gas business, average gross operated production came at at 117.8 kboepd in Q4. Rajasthan block’s average gross production was lower by 6% QoQ and by 13% YoY at 97.8 kboepd. Gross production from Development Area-1 (DA-1), Development Area-2 (DA-2) and Development Area-3 (DA-3) averaged 84.8 kboepd, 12.9 kboepd and 0.1 kboepd; respectively. The natural decline in the MBA fields has been partially offset by infill wells brought online in Mangala, Aishwariya and Raageshwari Deep Gas (RDG) fields.
Iron Ore business
Karnataka Iron Ore
Saleable ore production rose 13% to 1.7 million tonnes, in Q4 and 23% QoQ due to improved operational efficiency and process improvement. Pig Iron production rose 6% at 198 kt, up 6% YoY, driven by improved process efficiency resulting in increased production, partially offset by shutdown of small furnaces.
Steel Business
Total saleable production fell 11% YoY to 343 kt in Q4 in line with lower hot metal production.
Stock outlook
Riyank Arora, Technical Analyst at Mehta Equities said, “Metal stocks witnessed good profit booking during the latter half of the day as stocks saw some profit booking coming in at higher levels. Technically, Vedanta has touched a major resistance mark of Rs 301.00 on its weekly charts and is showing signs of healthy profit booking. We advise investors to lock in their trading gains here and wait for a dip towards Rs 282 – Rs 285 for any fresh buying positions on the stock.”
Brokerage Nuvama is bullish on the stock with a target price of Rs 394. It has revised its earlier target of Rs 371.
“Management has guided for USD in debt reduction at Vedanta Resources by FY27 without any incremental debt at Vedanta Ltd. The monetisation of steel and iron ore assets by Q1FY25E (expect $2 bn) shall act as a first step. Moreover, we expect a DPS of Rs 40 each in FY25E and FY26E. Reiterate 'BUY' with a target price of Rs 394 (earlier Rs 371),” said Nuvama.
Aditya Gaggar, Director of Progressive Shares said, "Consolidation of 9 months comes to an end with a Cup and Handle formation breakout in the stock which was confirmed with an above average Volume. Leading oscillator RSI replicates the price pattern while MACD has already given a positive crossover. From the ADX, +DMI has crossed -DMI which is considered a buy signal. As per the pattern breakout, the target is Rs 366."
Abhijeet from Tips2trades said, "Vedanta stock price looks bullish but also overbought on the daily charts with next resistance at Rs 311. Investors should keep booking profits as a daily close below the support of Rs 297 could lead to target of Rs 265 in the near term."
Vedanta Ltd is a subsidiary of Vedanta Resources Ltd and has operations in oil and gas, zinc, lead, silver, copper, iron ore, steel, and aluminium and power across India, South Africa and Namibia.