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Vedanta Limited · VEDL · NSE

Vedanta Limited is an Indian natural-resources group that produces aluminium, zinc, oil and gas, power, steel and copper, earning from commodity-linked volumes, premiums and processing spreads.

₹333.55
Price
₹1,304.3B
Market cap
₹1,740.8B
FY26 combined revenue
39%
FY26 EBITDA margin
Available 10-year daily history starts at ₹99.95 in May 2016; peaked at ₹787.50 on April 17, 2026, then reset to ₹333.55 after the demerger.
2 · The tension

The split changes the ticker; the cash bridge decides the stock.

  • Demerger is live. May 1, 2026 became the effective date; record-date holders receive one share each in Vedanta Aluminium Metal, Vedanta Power, Vedanta Oil and Gas, and Vedanta Iron and Steel. The traded residual line is incomplete until the new lines list, targeted around mid-June 2026.
  • The denominator is not clean yet. FY26 presentation revenue was ₹1,740.8B versus statement revenue of ₹784.4B; presentation EBITDA was ₹559.8B versus statement operating income of ₹231.8B. Discontinued-operations accounting can explain the gap, but valuation needs the entity bridge.
  • Debt moves from group to entity. Headline net debt / EBITDA was 0.95x, but Vedanta Power carried a 4.7x pro forma leverage marker and Aluminium was allocated ₹327.0B of net debt. Each line now has to price its own cycle.
The demerger is not a value unlock until investors can trace cash after capex, debt service, dividends and related-party flows.
3 · Core engines

Two engines carry the company; only one is already proven.

₹255.0B
Aluminium FY26 EBITDA 45.6% of group
₹220.6B
Zinc India FY26 EBITDA 39.4% of group
₹84,768/t
Zinc India CoP 56% EBITDA margin
₹154,818/t
Aluminium CoP five-year low

Zinc India has the cleaner moat: ore, domestic share, reserve depth and silver credits already show up in margins. Aluminium is bigger, but its durability still depends on Sijimali bauxite, Kuraloi and Ghogharpalli coal, Lanjigarh alumina and power reliability showing up in FY27 cost data.

4 · Money picture

FY26 cash is real; the multiple is low for a reason.

₹559.8B
FY26 EBITDA 39% margin
₹187.5B
FCF after capex FY26
0.95x
Net debt / EBITDA Q4 FY26
3.3x
EV / EBITDA current

Cash conversion offsets a pure accounting bear case: FY24-FY26 operating cash flow was 2.16x net income and free cash flow was 1.14x net income. The low multiple compensates investors for cycle risk, presentation-to-statement comparability, parent cash claims and uncertainty over which entity keeps the cash.

5 · Governance

The moat leaks if related-party cash keeps moving upstairs.

  • Control is concentrated. Promoters own 56.38%, the board is 50% formally independent, and the operating bench is more credible than the control structure. Minority protection depends on independent directors constraining capital allocation, not on formal titles.
  • Cash transfers are recurring. FY2025 included ₹30.39B of management and brand fees, ₹96.98B of dividends to holding companies, and ₹36.36B of related-party loans. Those flows are not side notes; they are the bridge between asset economics and minority returns.
  • History raises the burden of proof. FY2025 audit was unmodified, but FY2021 controls were qualified around related-party loans and guarantees, and the regulator previously warned over ₹14.07B of related-party transactions without prior audit committee approval.
The operating moat belongs to shareholders only after fees, loans, guarantees and dividend discretion are accounted for.
6 · Next 90 days

The calendar can settle more than a year of debate.

  • Listings first. The four resulting-company listings targeted around mid-June 2026 will show liquidity, implied multiples and whether aluminium, power, oil and gas, and iron/steel trade at pure-play or control discounts.
  • Entity bridge next. Late July to August 2026 Q1 FY27 disclosures should attach revenue, EBITDA, debt, capex, cash, dividends and related-party flows to each entity. This is the main test of whether 0.95x leverage was transferable value or a group-level snapshot.
  • Two operating tripwires. The April 14, 2026 Athena/Singhitarai blast suspended 600 MW operations and paused PLF guidance, while Sijimali bauxite approval and access-road issues remain tied to the aluminium cost case.
The next move is less about a generic earnings beat than about whether the new entities can be valued without hand-built reconciliations.
7 · Bull & Bear

Watchlist: asset quality is investable; the bridge is not yet.

  • For. FY26 delivered ₹187.5B of post-capex free cash flow and net debt / EBITDA fell to 0.95x, so the balance sheet has room if EBITDA does not normalize hard.
  • For. Aluminium and Zinc India produced about ₹475.6B of FY26 EBITDA, roughly 85% of the group, and both have cost-curve evidence that deserves a better lens than a conglomerate average.
  • Against. FY26 presentation revenue, EBITDA and leverage need an entity-level reconciliation before a clean SOTP multiple is defensible.
  • Against. Promoter control, brand fees, revised zinc dividend discretion, Athena safety risk and Sijimali approval risk can all absorb cash before minorities see the operating upside.
My view: wait for the first entity-level bridge. The long case flips from watchlist to actionable if each company funds capex and dividends from post-capex cash while related-party leakage stays contained.

Watchlist to re-rate: Mid-June resulting-company listings; Q1 FY27 entity debt / FCF / related-party bridge; aluminium CoP with Sijimali progress and Athena root-cause / restart disclosures.