Vedanta demerger
Vedanta demerger
Vedanta Limited, headed by billionaire Anil Agarwal, announced the establishment of separate verticals on September 29 in order to unlock potential value by demerging the underlying industries, namely its metals, electricity, Aluminium, and oil and gas operations.
Vedanta Demerger Shares Ratio
According to Vedanta, the de-merger is intended as a vertical split, and shareholders will get 1 share of each of the 5 newly listed entities for every 1 share of Vedanta Limited.
As stated, the company plans six separate listed entities.
- • Vedanta Limited
- • Vedanta Aluminium
- • Vedanta Oil & Gas
- • Vedanta Power
- • Vedanta Steel and Ferrous Materials
- • Vedanta Base Metals
1. Vedanta Limited ( Including HZL )
Run by – ARUN MISRA, currently CEO of HZL
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 34,442 | 30,110 |
| EBITDA | 17,539 | 16,509 |
| Operating Profit | 13,917 | 13,247 |
Vedanta Limited will continue to foster new companies, notably in technology.
With a defined capital allocation plan, investors will have the chance to participate in zinc production properties that are among the best in the world.
2. Vedanta Aluminium
Run By – JOHN SLAVEN, formerly of Alcoa and BHP
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 52,618 | 50,809 |
| EBITDA | 5,775 | 17,337 |
| Operating Profit | 3,257 | 15,066 |
The group’s total capacity is 2.4 MTPA when coupled with Bharat Aluminium Company Ltd.
(BALCO), a subsidiary owned 51% by Vedanta Limited.
3. Vedanta OIL & GAS
Run By – STEVE MOORE
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 15,038 | 12,430 |
| EBITDA | 7,782 | 5,992 |
| Opearting Profit | 5,205 | 4,359 |
The business hopes to contribute 50% of India’s total oil and gas output by diversifying its reserves,
positioning it to profit from India’s estimated 50% increase in demand by 2030.
Their vast footprint is 65,000 square kilometres, and their gross 2P and 2C resource is more than 1.1 billion barrels of oil equivalent.
4.Vedanta Power
Run By – VAIBHAV AGARWAL, currently CEO of TSPL
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 6,724 | 5,501 |
| EBITDA | 913 | 1,082 |
| Operating Profit | 294 | 470 |
the 600 MW Jharsuguda plant, the newly purchased 1200-MW Athena project,
and the recently concluded acquisition of the 1000 MW Meenakshi plant,
Vedanta Power consolidates Vedanta’s Independent Power Plants. When this company is finished, it will have around 5 GW of capacity in total.
5. Vedanta STEEL & FERROUS Materials
Run By – NAVIN JAJU, currently CEO OF iron ore
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 13,882 | 12,707 |
| EBITDA | 1,302 | 2,981 |
| Operating Profit | 770 | 2,585 |
which also includes the Value Added Business (VAB).
By 2025, they want to increase their annual iron ore production by more than double, to 13Mt.
ESL Steel Limited (ESL), a 95.49 percent subsidiary of Vedanta,
an integrated steel manufacturer with operations in Bokaro, Jharkhand, India,
is another company in this field.
They are increasing their capacity to 3 MT per annum of hot metal by the middle of 2024 from their current 1.5 MT per annum capability.
6. Vedanta Base Metals
Run By – CHRIS GRIFFITH, former CEO of Gold Fields and previously at Anglo American
| Figures in Rs crore | FY2023 | FY2022 |
| Revenue | 22,700 | 19,635 |
| EBITDA | 1,930 | 1,418 |
| Operating Profit | 1,243 | 697 |
The Gamsberg mine in South Africa, one of its Zinc International properties, contributed to a record output of 208kt in 2023, while Black Mountain also had considerable increase in FY23.
The copper industry, which consists of copper rod manufacturing, custom smelters, refineries, phosphoric acid, and sulfuric acid facilities, may provide almost a third of India’s copper needs.
In 2024, production is anticipated to resume.
Chairman Message
Vedanta Limited
The chairman of Vedanta, Anil Agarwal, responded to the announcement of the demerger by saying, “In accordance with Vedanta’s culture, each firm will continue to retain a strong commitment to the well-being of our workers, our communities, and our planet.
We shall be consistent in our commitment to change for the better even as we transition to new methods of operating our businesses.
The goal of the newly formed businesses is to spend $5 billion over the next ten years to hasten the transition to net-zero carbon emissions by 2050 and net water positive by 2030.
Through power supply agreements across our group companies, we have already secured 1.8 GW of renewable energy as part of our move to net zero, according to Vedanta.
Hindustan Zinc
Vedanta subsidiary Hindustan Zinc had previously disclosed to the public markets that its board has resolved to explore corporate restructuring options in order to spur development.
The restructure is intended to divide the recycling, lead, zinc, and silver companies into independent businesses.
The firm hopes to create new businesses that will be better positioned to capitalise on their unique market positions and produce long-term development as part of the potential restructuring in order to unlock value for shareholders.
Additionally, the reorganisation will work to create a financial structure and capital allocation procedures that are appropriate for each firm.
SOURCE – Vedanta Circular on BSE
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