Vedanta shares dive 9% to trade near one-year low level on stake sale report. Details here

Shares of Vedanta fell sharply in Thursday's trade to trade near their one-year low price. The stock tumbled 8.96 per cent to hit a day low of Rs 247.80 over its previous close of Rs 272.20. At today's low price, the stock is just 0.79 per cent away from its 52-week low of Rs 245.85, a level seen August 4, 2022. And, it has slumped 27.28 per cent from its one-year high price of Rs 340.75, hit on January 20 this year.

Today's plunge came after it was reported that Vedanta's top shareholder, Twin Star Holdings, would sell a 4.30 per cent stake in the company. The proceeds from stake sale would be apparently used to repay debt of parent company Vedanta Resources. The shares under the stake sale were being offered at Rs 258.50 apiece.

However, Vedanta is yet to issue an official statement regarding the stake sale.

On BSE, around 1.68 crore shares changed hands today, which was way more than the two-week average volume of 5.57 lakh shares. Turnover on the counter stood at Rs 431.19 crore, commanding market capitalisation (m-cap) of Rs 94,063.66 crore. There were 9,07,126 buy orders today against sell orders of 5,56,851 shares.

On the earnings front, the metals conglomerate reported a 40 per cent decline in consolidated net profit at Rs 2,640 crore for the quarter ending June 30, 2023 (Q1 FY24). It reported consolidated net profit of Rs 4,421 crore in the year-ago period.

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As per the June 2023 shareholding data, promoters held 68.11 per cent in Vedanta. In Q1 FY24, Vedanta reported a net debt of about Rs 59,200 crore. Net debt-to-EBITDA ratio rose to 1.88 times in the June quarter against 1.28 times in the March quarter.

"Vedanta has now reduced debt by $3 billion since it announced in February 2022 its intention to accelerate deleveraging and reduce its debt by $4 billion within 3 years. Vedanta has thereby achieved 75% of its committed reduction in just 14 months," the mining major said.

Kush Ghodasara, CMT, said, "The stock has broken out from the 3-month-old consolidation zone today on block deal news. Technically, this downfall is with heavy volumes and indicators have turned bearish. All short-term moving averages have given bearish crossover. So, the stock will be weak in the near term. Stop loss would be placed at Rs 274."

Osho Krishan, Senior Analyst, Technical & Derivative Research at Angel One, said, "Vedanta while being in a sideways trend on higher time frame charts, the daily charts of this steel major doesn't paint a rosy picture as today's gap down on the back of relatively higher volume adds to the bearish undertone. The stock trades below all its major EMA's. As far as levels are concerned, the higher gap and breakdown zone of Rs 265-275 is likely to provide strong resistance to stock. On the flip side, the swing low of Rs 230-odd zone is expected to provide a cushion in a comparable period."

AR Ramachandran from Tips2trades said, "Vedanta is bearish on the daily charts with next strong support at Rs 250. A daily close below this support could lead to target of Rs 219 in the near term. Resistance will be at Rs 261."

Meanwhile, Indian equity benchmarks extended their fall in afternoon deals today, dragged by bank, financial, technology, consumer, realty and energy stocks.

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