Vedanta jumps 3% as board to consider interim dividend

Shares of Vedanta rose 3 percent on December 14, a day after the company said its board would consider and approve second interim dividend for FY24 on December 18. The company had in May declared its first interim dividend of Rs 18.50 a share.

Vedanta’s dividend outgo has gone up significantly in recent years. In FY23, Vedanta paid a total dividend of Rs 37,572 crore, compared to Rs 16,689 crore in FY22 and Rs 3,519 crore in FY21.

Concerns have grown regarding potential delays in refinancing parent company Vedanta Resources’ (VRL) upcoming debt maturities, possibly extending beyond the anticipated schedules.

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This comes amid reports suggesting that VRL secured $1.25 billion from private credit lenders for debt refinancing and a new credit facility.

In a late-night statement, the company said fundraising will help create a long-term sustainable capital structure and demonstrate its continued ability to access global capital markets and investor confidence in the underlying business.

VRL said the loan was raised from a group of reputable financial institutions to refinance existing liabilities. The company did not disclose the names of the lenders.

S&P Global Ratings downgraded the rating of VRL, citing concerns about extension of maturities of some of its bonds. The agency’s action on the UK-based company’s bonds was spurred by the high “likelihood of a conventional default”.

“This is because of the company’s large upcoming debt maturities and weakened access to both internal cash flow and external financing,” S&P Global said. The company has about “$4.5 billion in debt maturities through March 2025″.

Also Read | Vedanta Resources raises $1.25 billion loan from global private credit lenders

Listed in India, Vedanta Ltd is predominantly owned by promoters holding a 63.71 percent stake. So far this year, the Vedanta stock has fallen nearly 20 percent, underperforming the benchmark Sensex which has risen 15 percent during this time.

At 1.03 pm, Vedanta Ltd was trading at Rs 254.3 on BSE, up almost 3 percent from the previous close.

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