Vedanta Limited, the diversified mining giant led by billionaire Anil Agarwal, has announced its fourth interim dividend for the financial year 2024-25. The dividend, amounting to ₹8.5 per equity share, totals ₹3,324 crore. This development was disclosed in an exchange filing on December 16, 2024.
Key Dividend Details
- Dividend Amount: ₹8.5 per equity share with a face value of ₹1.
- Total Payout: ₹3,324 crore.
- Record Date: December 24, 2024.
- Payment Timeline: The dividend will be distributed within the stipulated time frame.
With this latest announcement, Vedanta’s total dividend payout for FY25 has reached an impressive ₹16,799 crore.
Dividend Timeline for FY25
| Ex-Date | Dividend (₹/Share) |
|---|---|
| December 24, 2024 | ₹8.5 |
| September 10, 2024 | ₹20 |
| August 2, 2024 | ₹4 |
| May 24, 2024 | ₹11 |
Supporting Vedanta Resources’ Financial Goals
The parent company, Vedanta Resources, has been focused on deleveraging and refinancing its debt. According to CFO Ajay Goel, the organization aims to maintain single-digit financing costs in the near future. The interest obligations are covered through brand fees, while principal repayments are supported by routine dividend inflows.
“This approach ensures that Vedanta Resources Limited (VRL) remains self-funded moving forward,” said Goel during the September quarter earnings call on November 8.
Improved Financial Position for Vedanta
Vedanta has been making significant strides in reducing its debt and improving financial stability. In the September quarter, the company reported a net profit of ₹4,352 crore, boosted by higher revenue from metals and a write-back of expenses.
- Net Debt: As of Q2 FY25, the net debt stood at ₹56,927 crore, reflecting a reduction of ₹4,400 crore compared to the June quarter.
- Net Debt-to-EBITDA Ratio: Improved to 1.49x, signaling stronger financial health.
- Recent QIP Fundraising: The company raised ₹8,500 crore through Qualified Institutions Placement (QIP) at ₹440 per share, further strengthening its balance sheet.
Moody’s Rating Upgrade
Vedanta Resources achieved a significant milestone in October 2024 when Moody’s upgraded its corporate family rating from Caa1 to B3, acknowledging the company’s successful fundraising efforts and improved liquidity position. The rating on senior unsecured bonds issued by Vedanta Resources was also upgraded, signaling positive investor confidence.
Release of Encumbered Shares
On December 6, Vedanta Resources released encumbered shares held by subsidiary entities such as Twin Star, Welter Trading, Vedanta Mauritius I & II, and Vedanta Netherlands. This action resulted in substantial deleveraging at the group level, reducing debt to its lowest level in a decade.
Stock Market Performance
Despite the positive dividend announcement, Vedanta’s shares ended slightly lower by 1.15% on December 16, 2024, closing at ₹513.45 on the NSE. However, the stock has delivered stellar returns in 2024, nearly doubling its value over the year and pushing the company’s market capitalization past ₹1.9 lakh crore.
Looking Ahead
Vedanta’s continued focus on shareholder returns, debt reduction, and operational efficiency highlights its commitment to sustainable growth. The latest dividend payout reflects the company’s strong cash flow and profitability. With improved ratings and reduced debt levels, Vedanta is well-positioned to maintain its leadership in the metals and mining sector.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors are advised to consult their financial advisors before making investment decisions.