Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

<ul>
<li>Latest Update: NCLAT has stayed NCLT’s rejection, allowing Vedanta’s five-way demerger to proceed, with completion targeted by September 2025.</li>
<li>Value Concentration: Over 85% of Vedanta’s SOTP value stems from Aluminium and Residual Vedanta, driven by strong EBITDA and asset base.</li>
<li>Upside and Risks: SOTP suggests 20%+ upside, but risks include regulatory delays, execution slippage in aluminium/zinc projects, and commodity price volatility.</li>
</ul>


Latest Update: NCLAT has stayed NCLT’s rejection, allowing Vedanta’s five-way demerger to proceed, with completion targeted by September 2025.
Value Concentration: Over 85% of Vedanta’s SOTP value stems from Aluminium and Residual Vedanta, driven by strong EBITDA and asset base.
Upside and Risks: SOTP suggests 20%+ upside, but risks include regulatory delays, execution slippage in aluminium/zinc projects, and commodity price volatility.


Vedanta Demerger: Key Highlights, Value Drivers, and Risks

<ul>
<li>Vedanta reported 10% revenue growth and 37% EBITDA growth in FY25, supported by volume expansion across aluminium and zinc businesses.</li>
<li>Major capex projects, including Gamsberg Phase 2 and captive bauxite and coal mines, are expected to drive volume growth through FY27, with steady operational guidance.</li>
<li>Vedanta Resources standalone net debt reduced from $8.9 billion to $4.9 billion over three years, easing refinancing risks and improving financial flexibility.</li>
</ul>


Vedanta reported 10% revenue growth and 37% EBITDA growth in FY25, supported by volume expansion across aluminium and zinc businesses.
Major capex projects, including Gamsberg Phase 2 and captive bauxite and coal mines, are expected to drive volume growth through FY27, with steady operational guidance.
Vedanta Resources standalone net debt reduced from $8.9 billion to $4.9 billion over three years, easing refinancing risks and improving financial flexibility.


Vedanta’s Volume-Led Growth and Deleveraging Journey

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Vedanta’s demerger scheme crossed one major milestone after the approval by the company’s Equity Shareholders, Secured Creditors, and Unsecured Creditors on 18th Feb’25.</li><li>To assess the impact of the demerger, we present our valuation scenarios pre- and post-demerger in this note.</li><li>We continue to see value unlocking post demerger (refer to exhibits 1 and 2), especially from the Aluminium business. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Vedanta’s demerger scheme crossed one major milestone after the approval by the company’s Equity Shareholders, Secured Creditors, and Unsecured Creditors on 18th Feb’25.To assess the impact of the demerger, we present our valuation scenarios pre- and post-demerger in this note.We continue to see value unlocking post demerger (refer to exhibits 1 and 2), especially from the Aluminium business. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Vedanta Limited - Company Update - Demerger (Not Rated)

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

<ul>
<li>In today's Morning Views publication we comment on developments of the following high yield issuers: Hanwha TotalEnergies, Vedanta Resources.</li>
<li>Hanwha TotalEnergies Petrochemical (HTP) is a vertically integrated petrochemicals producer in South Korea.</li>
<li>The company produces a range of commodity chemicals, including base chemicals (olefins and aromatics), polymers (e.g. polyethylene and polypropylene) and energy products (jet fuel and diesel).</li>
</ul>


In today's Morning Views publication we comment on developments of the following high yield issuers: Hanwha TotalEnergies, Vedanta Resources.
Hanwha TotalEnergies Petrochemical (HTP) is a vertically integrated petrochemicals producer in South Korea.
The company produces a range of commodity chemicals, including base chemicals (olefins and aromatics), polymers (e.g. polyethylene and polypropylene) and energy products (jet fuel and diesel).


Market & Forensics Analyst, Beat the Street

Nimish Maheshwari

Market & Forensics Analyst

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/vedanta-ltd" target="_blank" data-smartkarma-citation="entities:514:1" rel="noopener">Vedanta Ltd (VEDL IN)</a> plans a multi-segment demerger to unlock value by separating its aluminum, zinc, oil and gas, steel, and other core operations into standalone entities.</li>
<li>This restructuring aims to eliminate conglomerate discount, foster specialized leadership, and attract fresh capital, potentially enhancing overall valuations and fueling long-term growth across diversified segments.</li>
<li>Despite governance concerns and cyclical commodity risks, pure-play listings could catalyze re-ratings, offering heightened returns but requiring vigilance on execution and corporate transparency.</li>
</ul>



Vedanta Ltd (VEDL IN) plans a multi-segment demerger to unlock value by separating its aluminum, zinc, oil and gas, steel, and other core operations into standalone entities.
This restructuring aims to eliminate conglomerate discount, foster specialized leadership, and attract fresh capital, potentially enhancing overall valuations and fueling long-term growth across diversified segments.
Despite governance concerns and cyclical commodity risks, pure-play listings could catalyze re-ratings, offering heightened returns but requiring vigilance on execution and corporate transparency.


Event Driven: Vedanta Ltd: A Story of Wealth Creation Through Demerger

India

Vedanta Limited mines, produces, and exports base metals. The Company mines and distributes metals such as zinc, iron ore, copper, silver, and aluminium, as well as operates power plants. Vedanta markets its products worldwide.

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Vedanta Ltd (VEDL IN)

Vedanta Demerger: Key Highlights, Value Drivers, and Risks

NCLAT allows Vedanta's demerger to proceed, with majority value in Aluminium and Residual Vedanta, offering 20%+ upside but facing risks of...

Rahul Jain

Vedanta’s Volume-Led Growth and Deleveraging Journey

Vedanta sees strong revenue and EBITDA growth in FY25, driven by volume expansion in aluminium and zinc. Major capex projects and debt reduction...

Rahul Jain

Vedanta Limited - Company Update - Demerger (Not Rated)

Vedanta’s demerger scheme crossed one major milestone after the approval by the company’s Equity Shareholders, Secured Creditors, and Unsecured...

Axis Direct

Lucror Analytics - Morning Views Asia

In today's Morning Views publication we comment on developments of the following high yield issuers: Hanwha TotalEnergies, Vedanta Resources

Lucror Analytics

Event Driven: Vedanta Ltd: A Story of Wealth Creation Through Demerger

Vedanta Ltd plans multi-segment demerger to unlock value by separating core operations into standalone entities, aiming to eliminate conglomerate...

Nimish Maheshwari

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Vedanta Demerger: Key Highlights, Value Drivers, and Risks

​NCLAT allows Vedanta's demerger to proceed, with majority value in Aluminium and Residual Vedanta, offering 20%+ upside but facing risks of...

Rahul Jain

Vedanta’s Volume-Led Growth and Deleveraging Journey

​Vedanta sees strong revenue and EBITDA growth in FY25, driven by volume expansion in aluminium and zinc. Major capex projects and debt reduction...

Rahul Jain

Vedanta Limited - Company Update - Demerger (Not Rated)

Vedanta’s demerger scheme crossed one major milestone after the approval by the company’s Equity Shareholders, Secured Creditors, and Unsecured...

Axis Direct

Lucror Analytics - Morning Views Asia

In today's Morning Views publication we comment on developments of the following high yield issuers: Hanwha TotalEnergies, Vedanta Resources

Lucror Analytics

Event Driven: Vedanta Ltd: A Story of Wealth Creation Through Demerger

​Vedanta Ltd plans multi-segment demerger to unlock value by separating core operations into standalone entities, aiming to eliminate conglomerate...

Nimish Maheshwari

NCLAT allows Vedanta's demerger to proceed, with majority value in Aluminium and Residual Vedanta, offering 20%+ upside but facing risks of...

Vedanta sees strong revenue and EBITDA growth in FY25, driven by volume expansion in aluminium and zinc. Major capex projects and debt reduction...

Vedanta Ltd plans multi-segment demerger to unlock value by separating core operations into standalone entities, aiming to eliminate conglomerate...