Vedanta Share Price Soars to 52W Peak: Unlocking Value via Demerger & Debt Paydown

Vedanta Share Price Soars to 52W Peak: Unlocking Value via Demerger & Debt Paydown

Vedanta Ltd shares surged to a 52-week high of ₹537.65 on December 1, 2025 (open ₹535, close ₹533.30, up 1.39%), driven by accelerated demerger progress across six verticals (aluminum, power, metals, oil & gas, steel, display glass) and aggressive debt reduction (net debt down 15% YoY to ~₹60,000 Cr), unlocking conglomerate value amid metal price tailwinds and volume ramp-ups.​

Demerger Catalysts Fueling Rally

NCLAT approved key demerger schemes (aluminum/power first), with board nods for remaining verticals targeting Q1 FY27 listings; this separates high-growth zinc/iron ore from loss-making units, projecting 16% pre-tax earnings CAGR through FY28 via 10-15% volume growth (aluminum +5% to 2.4MT). Market rewards: shares +17.6% YTD, +69% 3Y vs Nifty +50%, with analyst targets ₹575 (ICICI/Emkay BUY calls).​

Debt Reduction Progress

Q2 FY26 EBITDA ₹9,500 Cr (OPM 23%) supported ₹4,500 Cr repayments, slashing debt/equity to 1.79x (from 2.34x FY24); CFO ₹39,562 Cr funds capex without dilution, ROE 36.36% (best in 5Y), dividend yield 8.16% (₹16/share interim). Promoter holding steady at 56.38%; FIIs net buyers amid China stimulus boosting base metals.​

Metric	Value	vs Peers	Trend
52W High/Low	₹537.65/₹363	Hind Zinc ₹500 ​	+48% range
TTM PE/PB	17.36x/5.57x	Sector 12.89x PE	Premium on growth
ROE/ROCE	36%/27%	Hind Zinc 78%/avg ​	Outperforms 5Y
Debt/Equity	1.79x	Improved 24% YoY	Sustainable

Financial Snapshot and Outlook

FY25 revenue ₹1.57L Cr (+7%), PAT ₹14,988 Cr (+254%), Q2 sales ₹40,464 Cr (+4%); aluminum/zinc shine amid LME rally, but O&G lags. Consensus: 14 analysts BUY (10/14), targets ₹575 (8% upside); risks include commodity cycles, forex (beta 1.87). December seasonality +4.81% avg favors extension to ₹550+ if NCLAT clearances accelerate.​

Vedanta's structural unlocks position it for sustained re-rating, rewarding patient investors eyeing 20%+ CAGR through demerged entities.

Vedanta Limited has achieved a clean exit from its pursuit of the debt-heavy Jaiprakash Associates Limited (JP Associates) deal, avoiding entanglement in the ₹59,000 Cr insolvency saga after creditors unanimously favored Adani Enterprises' proposal over Vedanta's higher ₹17,000 Cr bid (NPV ₹12,505 Cr) in November 2025 CoC voting. This sidesteps execution risks in cement/power/real estate assets amid JP's homebuyer claims (₹100s Cr) and staggered payments (Vedanta's ₹4,000 Cr upfront over 5-6 years deemed less attractive vs Adani's quicker payout).​

Deal Timeline and Bidding War

Vedanta topped September 2025 auctions (beating Adani/Dalmia/Jindal/PNC), secured CCI nod (Oct), but CoC prioritized cash flows—Adani's LOI issued Nov 19 despite lower NPV (~₹500 Cr gap), pending NCLT Allahabad approval (Q1 FY26 est.). JP promoters' ₹18,000 Cr settlement bid rejected for funding doubts; NARCL (90% creditor via SBI-led loans) drove ~71% haircut preference.​

Strategic Benefits of Vedanta's Exit

Dodges unrelated diversification (cement/power vs core metals), preserving ₹60,000 Cr net debt focus (1.79x equity post-Q2 FY26 cuts); frees balance sheet for aluminum/zinc capex amid 52W high rally (₹537). Nuvama notes minority investor relief, avoiding execution delays (NCLT 3-4 months + promoter litigation).​

JP Assets and Adani's Play

JP spans 20MTPA cement, 1,200 MW hydro, ₹10,000 Cr realty (Jaypee Greens Noida/Wishtown); Adani eyes infra synergies, funding via internal accruals post-regulatory nods.​

Aspect	Vedanta Bid	Adani Proposal	Outcome Impact
Offer Value	₹17,000 Cr (NPV ₹12,505 Cr) ​	Lower NPV but faster cash ​	Vedanta avoids 71% creditor haircut
Payment	₹4K Cr upfront, rest 5-6Y ​	2Y timeline preferred ​	Clean exit preserves liquidity
Risks Avoided	Homebuyer suits, dilution ​	Litigation exposure ​	Focus on demerger (aluminum/power Q1 FY27)

Vedanta's withdrawal reinforces debt discipline (ROE 36%), positioning for metals rebound vs conglomerate sprawl—watch NCLT for Adani closure.