Vedanta Ltd Incorporates Vedanta Base Metals Ltd as Part of Overhaul

Vedanta Ltd Incorporates Vedanta Base Metals Ltd as Part of Overhaul

VoM News Desk | October 11, 2023 | 04:45 PM IST | Breaking News | Follow on Google News

Vedanta Ltd Incorporates Vedanta Base Metals Ltd as Part of Overhaul

Vedanta Ltd Incorporates Vedanta Base Metals Ltd as Part of Overhaul

Vedanta Ltd has taken a significant step in its corporate overhaul, incorporating its base metals unit, Vedanta Base Metals Ltd. This subsidiary, with an authorized share capital of ₹1 lakh, was established as a public company on October 09, 2023, in Maharashtra. Its primary objective is to engage in the metal business, as stated in the company’s exchange filing.

Vedanta Group’s Restructuring Initiative

Vedanta Group, led by billionaire Anil Agarwal, is undergoing a substantial overhaul of its Indian metals, mining, and energy conglomerate, Vedanta Ltd, with the aim of maximizing value for its investors. This restructuring will divide the current business into several separate entities, including Vedanta Aluminium, Vedanta Oil and Gas, Vedanta Power, Vedanta Steel and Ferrous Materials, Vedanta Base Metals, and Vedanta Ltd. Shareholders of Vedanta Ltd will receive one additional share of each of these newly listed entities for every share held in Vedanta.

The demerger and listing of these separate business units are expected to take 12-15 months, subject to all necessary approvals. Additionally, Hindustan Zinc Limited, a subsidiary of Vedanta Limited, is undergoing a comprehensive review of its corporate structure, intending to create separate legal entities for the Zinc & Lead, Silver, and Recycling businesses.

Market Response to the Demerger News

Following the announcement of the demerger plan, Vedanta’s share price experienced a more than 3% increase. The shares opened at an intraday level of ₹222.15 apiece on the BSE. Analysts note that while Vedanta’s share price had shown weaker performance and hadn’t participated in recent upward trends, it has maintained a solid support level within the range of ₹220 to ₹210. In today’s session, it showed some traction backed by volume. To signal a potential bullish reversal, prices would need to surpass the ₹235 mark, potentially propelling them to the ₹250 to ₹260 range. For those already holding long positions, maintaining them with a closing stop loss at ₹210 is advisable.

VoM News Desk

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