Vedanta shares fall 14% year-to-date. Should you
buy or sell?

Produced by: Harshita Tyagi
Designed by: Pragati

Vedanta shares tanked more than 5% on March 23, 2023. So far this year, the stock of Anil-Agarwal led company has tanked over 13%. In the last one month, Vedanta share price has plunged 10%

Vedanta shares slump

Vedanta stock tanked on Thursday amid reports of Anil Agarwal considering selling a minority stake in Vedanta as he looks to shrink his commodities business empire’s massive debt load

Why Vedanta shares
fell on March 23

5% stake sale in Vedanta

According to a Bloomberg report, Anil Agarwal is examining the possibility of divesting a stake of less than 5% in the company. Vedanta’s shares have fallen about 32% in the last 1 year, giving it a market value of about $12.6 billion. A 5% stake would be worth about $630 million

Anil Agarwal has denied the stake sale reports. The billionaire, when asked about the 5% stake sale, told CNBC-TV18, "Deny any intention to sell any stake in Vedanta." 

Stake sale news baseless

Vedanta debt burden

Vedanta's Anil Agarwal had invested $22 billion in oil and gas, $17 billion in aluminium and $20 billion in zinc. His total debt from all these investments stands at $13 billion, the billionaire said at India Today Conclave 2023 recently.

Last week, Vedanta Resources, which owns about 70% of Vedanta, repaid $250 million in loans that the company took from Barclays Bank and Standard Chartered Bank. The entity has been in talks with at least three banks for a loan of as much as $1 billion.

Vedanta debt repayment

Vedanta had earlier said it has enough means to meet debt repayment liabilities in the coming quarters. Vedanta’s debt repayment liabilities came under scanner after the government opposed the proposed sale of the international zinc business to Hindustan Zinc.

Debt repayment liabilities

Vedanta Resources has said that it has pre-paid all of its debt that was due for repayment till March 2023, deleveraging by $2 billion in the past 11 months. It is confident of meeting its liquidity requirements for the quarter ending June 2023.

Prepaid all due debt

"Vedanta stock is trading below its 21, 50 & 200-days EMA so one should avoid fresh buying as long as the price of the shares does not close above Rs 300. However, dips to the 260-250 region could allow bulls to regroup," said Akhilesh Jat, Category Manager - Equity Research at CapitalVia Global Research.

Should you buy
Vedanta shares?

The content in the story is for information purposes only. Investors or market participants should consult their financial advisors before taking any position

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