Vedanta demerger – 6 Separate Companies Financial Performance

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.

  1. Vedanta Limited
  2. Vedanta Aluminium
  3. Vedanta Oil & Gas
  4. Vedanta Power
  5. Vedanta Steel and Ferrous Materials
  6. Vedanta Base Metals

1. Vedanta Limited ( Including HZL )

Run by – ARUN MISRA, currently CEO of HZL

Figures in Rs croreFY2023FY2022
Operating Profit13,91713,247
With the help of robust revenues from the top-tier Hindustan Zinc assets,
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 croreFY2023FY2022
Operating Profit3,25715,066
With a capacity of 1.8 MTPA, the Jharsuguda facility, which is a part of Vedanta, is currently the biggest single-location aluminium smelting factory outside of China.
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


Figures in Rs croreFY2023 FY2022
Opearting Profit5,2054,359
Over a quarter of the domestic crude oil output in India is controlled by Vedanta Oil & Gas, the largest private oil and gas exploration and production business in the nation.

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 croreFY2023FY2022
Operating Profit294470
In addition to the 1980 MW Talwandi Sabo Power Limited (TSPL) in Punjab, India,
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 croreFY2023FY2022
Operating Profit7702,585
Goa, Karnataka, and Liberia are all part of Vedanta’s Iron Ore Business,
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 croreFY2023FY2022
Operating Profit1,243697
The Base Metals section of Vedanta will include upstream companies essential to the global energy transition as well as global production assets, growth initiatives, and downstream businesses.

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


If you like this blog please share and comment thanks.

This blog contains no recommendations. Please consult a financial advisor. This content is published for educational purposes