‘No stake sale activity in near term’: Vedanta to deleverage debt by $3 billion in 3 years

Vedanta Resources, the parent firm of Mumbai-based mining conglomerate Vedanta, plans to deleverage as much as $3 billion debt over the next three years, a senior official said at an analyst meeting.

“Deleveraging is our priority. We would be deleveraging the debt of Vedanta Resources by $3 billion over the next three years. Vedanta Ltd’s cash flow pre-growth capex is estimated to be $3.5-4 billion for the financial year 2025, sufficient for secured debt maturities of USD 1.5 billion,” said Navin Agarwal, Vice Chairman, Vedanta Ltd and member of Promoter Group, at a recently concluded analysts’ meet.

The financial year 2025 maturities of $1,100 million and close to USD 750 million of interest servicing would be managed through brand fees, dividends from operating companies, asset monetisation and other strategic initiatives.

“Vedanta is a dynamic organisation that continuously evaluates its capital structure. The parent company has multiple avenues to meet its debt obligation. Hence, we are not considering a stake sale actively in the near term.

“The recent dilution was part of a broader strategy to achieve optimal capital allocation. We believe the upcoming commissioning of growth projects will significantly enhance earnings potential, leading to a natural reduction in the cost of capital,” he said.

This transaction has sparked considerable interest among market participants, particularly foreign institutional investors (FIIs), domestic institutional investors (DIIs), and retail investors, who view it as a precursor to Vedanta’s forthcoming demerger announcement.