Vedanta announces demerger into six separate entities EBITDA target of $10 billion
New Delhi: In a major move poised to redefine its market presence and shareholder engagement, Vedanta Ltd. announced the demerger of its conglomerate into six separate entities at its 59th Annual General Meeting on Thursday.
The decision coincides with the advent of a new reformist government in India, heralding a promising era for sectors crucial to national growth, such as natural resources.
Vedanta's Chairman, Anil Agarwal, outlined the restructuring aimed at enhancing the company’s alignment with India’s ambitious economic and sustainability goals.
Agarwal said that Vedanta achieved its second-highest annual revenue at Rs1,41,793 crore and an EBITDA of Rs36,455 crore.
The company declared dividends totalling Rs18,572 crore for FY24, with a per-share dividend of Rs11.
Highlighting the financial strategy, Agarwal noted that 70 percent of Vedanta's revenue is derived from critical future minerals.
He added that the company is well-positioned to meet a $1 trillion sector opportunity as the demand for natural resources grows alongside the economy.
The company's expansion plans include over 50 projects with an investment totaling approximately $8 billion.
These projects have already begun to contribute to our top and bottom lines, Agarwal said. "We are well-positioned to meet our EBITDA target of $10 billion in the near future," he said.
"The demerger will lend speed to our journey. Each entity will have more independence in regard to capital allocation and their growth strategies.
Investors will have the freedom to invest in the industries of their choice, broadening the overall investor base for Vedanta assets," he said.
For every 1 share of Vedanta Limited that shareholders currently own, they will additionally receive one share of each of the five newly listed companies.
In the global flagship S&P Global Corporate Sustainability Assessment 2023, Vedanta ranked 3rd and HZL ranked 1st among 238 global metal and mining companies.
On the sustainability front, Vedanta is committed to achieving net-zero carbon emissions by 2050, with an investment of $5 billion earmarked for this purpose. The company has also focused on large-scale renewable energy projects to support this goal.
Community engagement through the Anil Agarwal Foundation has impacted 1.7 crore people in 2024, with nearly Rs 438 crore spent on various initiatives.
Agarwal emphasized the company's commitment to community transformation through programs focused on child welfare and women's skill development.
As Vedanta navigates its strategic demerger, the company is set to enhance its operational independence and investor appeal, aligning with India's broader economic policies and growth trajectory.
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