Vedanta Plans: The total payout will be Rs 4,089 crore, with May 25 designated as the dividend record date. After trading hours, announcements were made; the stock closed at Rs 433.60 on the NSE, down by Rs 3.80 or 0.87% from Wednesday’s closing. Additionally, the company board sanctioned the establishment of a continuous cast copper rod plant in Saudi Arabia.
Vedanta’s Financial Performance and Market Analysis:
Vedanta declared a Rs 11 per share interim dividend for FY 2024-25, totaling Rs 4,089 crore, with May 25 set as the record date. The board also approved raising up to Rs 8,500 crore through equity shares issuance. Additionally, they sanctioned the establishment of a continuous cast copper rod plant in Saudi Arabia. Investment in Vedanta Copper International (VCI) will establish a state-of-the-art copper rod manufacturing facility with a 125 KTPA capacity, expanding growth opportunities in new areas. After the investment, VCI will become Vedanta’s wholly owned subsidiary, as per Thursday’s filing.
After trading hours, announcements were made; the NSE stock closed at Rs 433.60, declining by Rs 3.80 or 0.87% from Wednesday’s close. Previously, the company reported a net profit of Rs 1,369 crore for the March-ended quarter, a decrease of over 27% (YoY) from Rs 1,881 crore in the same period last year. Consolidated revenue for the quarter was Rs 34,937 crore, down 6% YoY compared to the Rs 37,225 crore reported in Q4FY23.
The profit after tax for the fiscal year ending March 31 was Rs 4,239 crore compared to Rs 10,574 crore in FY23, marking a significant 60% YoY decrease. FY24 revenue from operations totaled Rs 1,41,793 crore, a decline from Rs 1,45,404 crore. Despite expenses of Rs 31,899 crore in Q1FY24 versus Rs 32,215 crore in Q3FY24 and Rs 33,041 crore in Q4FY23, the company recorded lower PAT and revenue for the January-March quarter.
For the second time in this fiscal year, the company is raising funds, having previously announced a plan to raise up to Rs 2,500 crore through debt securities. Vedanta is currently undergoing a process of splitting into six separate units. As of March 31, 2024, the company’s net debt increased by approximately 25% compared to the previous year, reaching Rs 56,338 crore. Cash and cash equivalents for the full year dropped to Rs 2,812 crore from Rs 6,926 crore a year earlier. Today, after trading hours, the company announced these developments. Vedanta shares closed lower by 0.96% at Rs 433.20.
Nuvama Institutional Equities noted that increasing commodity prices enhance cash flows and could lead to a rise in valuation multiples, indicating a potential reduction in the company’s debt burden. It suggested that Vedanta’s debt may have reached its highest point in FY24.
Antique Stock Broking has raised Vedanta’s price target to Rs 411 from Rs 318, aligning with global peers, implying an FY26 EV/Ebitda multiple of 4.2 times.
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