On June 20, 2024, Vedanta Limited received approval from its board to raise INR 1,000 crore. This will be done by issuing non-convertible debentures (NCDs), which are aimed at strengthening Vedanta’s financial resources.
With a face value of INR 1 ,00,000 each, 1 lakh NCDs will be issued. These funds will be raised on a private placement basis. This means that they will be offered directly to their existing investors rather than through a public offering.
They will provide essential capital to Vedanta for its operational and strategic initiatives. They will be available to trade on the Bombay Stock Exchange. This will increase transparency and feasibility for investors.
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The move will support business expansion
Vedanta will use these funds to cater to its various business needs and plan a strategic expansion. They have seen significant interest from investors in this issue. The share prices of Vedanta have surged a lot after this news. As of June 20, 2024, Vedanta’s shares were trading at INR 477.5 each, at an intraday high of 6.47%.
Promoter Stake Adjustment and Market Response
Earlier this year, Vedanta’s promoters reduced their stake in the company. This was done through a block deal which was valued at over INR 2,615 crore. The promoters currently hold approximately 61.95% of Vedanta. This is down from nearly 70% in December 2022. Anil Agarwal, chairman of Vedanta, said, “There are no immediate plans to further reduce promoter shareholding below the current levels.”
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Vedanta’s strategic decision to issue NCDs shows their confidence in themselves. This decision shows prospects of futuristic resilience and growth in the company.
About the Author
Mr. Radhesh Tarang Shah is a third-year management student at the Institute of Management, Nirma University. He has a passion for writing articles and poems. He has experience as a financial analyst, author, news writer, marketer and social worker.
