Vedanta Share Price is the Sensex Show Stopper this Week

Vedanta share price soared nearly 3% on Tuesday morning to hit a fresh 52-week high as the mining major extended its year-to-date gains to more than 13%. In a recent analyst meeting, the company’s management shed light on its debt reduction plans at the parent level and said that they remain upbeat on demand for metals and minerals on the back of a surge in demand for EVs and renewable energy.

Analysts see further upside in Vedanta’s share price while advising investors to buy more shares of the company. Vedanta shares were trading 2.9% higher at Rs 412.75 per share on Tuesday morning.

Vedanta Share Price hits 52 Week High on Tuesday

Chairman Anil Agarwal in a televised interview today shared his thoughts on investing in the semiconductor market in #India & plans to reduce net debt by $4 billion over the next 3 years

According to analysts at Motilal Oswal Financial Services and Systematix Institutional Equities, Vedanta has capex plans of $1 billion-$1.5 billion per annum over the next few years. The upshot: volume expansion, cost reduction, increase in share of value-added products and improvement in ESG (environmental, social and governance) standards, note analysts at Motilal Oswal in a report. “Capex is likely to continue even during a downturn to support these initiatives,” added the report

IIFL Securities has an ‘Add’ rating on the scrip with a target price of Rs 424 per share. “At the analyst meeting, Vedanta Chairman highlighted debt reduction of $5 billion over 3 years at parent Vedanta Resources as a top-most priority, led by an elevated $2 billion annual dividend payout by Vedanta. The brokerage firm said that group deleveraging, growth capex is in focus for Vedanta.

The company aims to enhance its volume capability across all its business. “In the near term over the next three years, Vedanta plans to raise its aluminium smelting capacity by 36% to 3mtpa (million tonnes per annum), raise zinc/ lead output by 36% to 1.7mtpa, silver capacity by 24% to 800 tpa, steel capacity by 133% to 3.5mtpa, ferro chrome capacity by 67% to 0.15mtpa, and add nickel smelting capacity of 7,000 tpa,” said a report by Systematix.

In the oil and gas business, analysts at Motilal Oswal remarked that its FY24E target production of 300kboepd (barrels of oil equivalent per day) seems to be a tall ask.

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