Vedanta shares fell 25% in two years; here are fresh price targets

Shares of metal and mining major Vedanta Ltd are trading at their 52-week high. The Anil Agarwal-led firm hit a 52-week high of Rs 308 on April 3, 2024. However, Vedanta stock is trading 38% lower to the record high of Rs 495. In terms of returns, the stock fell 25% in two years and rose 8% in a year. In five years, the stock has climbed 64%. The large cap stock stands higher than the 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages signaling the stock is trading in bullish zone.

Vedanta shares ended 4.80% higher at Rs 301.15 on Tuesday. In the last one month, the Vedanta stock has gained 11.54%. In the current session, the stock rose 2.32% to an intraday high of Rs 308 on BSE. Market cap of the firm rose to Rs 1.13 lakh crore. Vedanta shares have a one-year beta of 0.8, indicating very low volatility during the period.     

In terms of technicals, the relative strength index (RSI) of Vedanta stands at 69.1, signaling the stock is trading neither in the oversold nor in the overbought territory.

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.

Another brokerage Phillip Capital is bullish on the Vedanta stock.

“Vedanta Ltd has very ambitious plans in terms of capacity expansion and seems like trying to adopt the GE way (Jack Welch) that they want to be a top player in every business they enter. However, it has disappointed us several times w.r.t. to meeting its expansion deadline and thus we are not very keen on looking into FY28 or FY30 targets as of now. Backward integration into coal and Bauxite/alumina, higher ferrous sales and ramp-up of Gamsberg (Zinc International) look achievable to a large extent which is expected to drive the performance in the medium term. Demerger to unlock value and provide stake sale flexibility to the company. With medium-term financial risk diluted meaningfully, we continue to hold our positive stance on the company and reiterate our BUY rating on the stock with a SOPT target price of Rs 350,” said Phillip Capital.

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.