Shares of Vedanta tumble over 6% today after a substantial stake sale

Indian benchmark indices experienced a sharp sell-off and extended losses during today’s trading session. The BSE Sensex plunged 0.82% to 65,240 level at the close. The Nifty 50 index tumbled 0.74% to a level of 19,381. 

BSE Metals was one of the worst-performing sectors, losing more than 1% primarily due to a steep decline in shares of Vedanta Ltd. Following news that Twin Star Holdings, one of the company’s promoters, had sold a 4.3% holding through block deals, shares came under intense selling pressure. 

Shares of the metals and mining company plunged more than 6% during the session, reaching an intraday low of Rs 247.80, close to the 52-week low of Rs 245.85 per share on the BSE. 

Considering the company’s quarterly performance, on a consolidated basis, it reported a significant decline of 12.66% from Rs 38,622 crore registered in Q1FY23, recording total revenue of Rs 33,733 crore in Q1FY24. It has reported operating profit decline of more than 36%. When compared to the same quarter last year, the net profit for the first quarter of FY24 slumped 40%, from Rs 4,421 crore to Rs 2,640 crore. 

Vedanta is a leading global natural resources conglomerate with operations in India, South Africa, Liberia and Namibia. With interests in oil & gas, zinc-lead-silver, aluminium, iron ore, steel, copper, power and semiconductors, it is a diversified company across the natural resource’s spectrum. The company contributes about 1.4% of India’s GDP. At its core is a mission to boost manufacturing, cut imports and make India ‘atmanirbhar’ in natural resources.  

The performance of the metals and mining industry was adversely affected by higher input costs; however, the long-term outlook for the industry is optimistic primarily due to the government’s focus on infrastructural development. 

Keep a close eye on this stock for the upcoming sessions! 

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.