Vedanta To Raise ₹8,500 Cr Via QIP At A Floor Price Of ₹461 Per Share

On July 15, 2024, Vedanta Ltd, a major mining company, announced that it is launching a qualified institutional placement (QIP) issue at a base price of ₹461.26 per share. This move is intended to lower debt and cover some capital expenses.

In a filing to BSE, Vedanta announced that its committee of directors met and approved the opening of the issue on July 15, 2024. The committee set the floor price for the issue at ₹461.26 per share, which is slightly higher than Monday’s closing price of ₹459.40 per share on BSE.

In May, Vedanta’s board approved raising up to ₹8,500 crore through the issuance of securities, a move that was later endorsed by the shareholders. A senior official from Vedanta Resources, the parent company of Vedanta Ltd, mentioned at an analyst meeting that the company plans to reduce its debt by up to USD 3 billion over the next 3 years without expecting to extend its current loans.

Vedanta boasts a diverse asset portfolio in India and globally, spanning metals and minerals like zinc, silver, lead, aluminium, chromium, copper, and nickel; oil and gas; a traditional ferrous sector including iron ore and steel; and power, covering both coal and renewable energy. The company is also venturing into semiconductor and display glass manufacturing. As of March 31, 2024, the company’s total debt amounted to ₹71,759 crore.

About Vedanta Ltd

Vedanta Ltd is a diverse natural resource group that explores, extracts, and processes minerals, oil, and gas. It also engages in commercial power generation, steel manufacturing, port operations in India, and glass substrates in South Korea and Taiwan.

On July 16, 2024, Vedanta Ltd’s share price opened at ₹466.90, touching the day’s high of ₹466.90 as of 09:30 AM on the NSE.

Financial Highlights

Vedanta Ltd reported a 27.21% year-on-year (YoY) decline in consolidated net profit attributable to owners, totalling ₹1,369 crores for the March quarter, down from ₹1,881 crores in the same period last year. Consolidated revenue from operations decreased by 6.14% YoY to ₹34,937 crore, compared to ₹37,225 crore in the corresponding quarter of the previous year. The quarterly EBITDA dropped 4% YoY to ₹8,969 crore but increased 3% sequentially, mainly due to higher volume and cost-saving measures across businesses, partly offset by lower LME prices and exchange rate fluctuations.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.