As of March 2023, VRL possesses $1.7 billion in short-term investments, encompassing various bank deposits, quoted bonds, and mutual funds. Experts at CreditSites speculate that these investments could be liquidated if the need arises, potentially impacting their market value.
Image-: vedanta Aluminium
In a rather perplexing turn of events, it has been reported that Vedanta Ltd, promoted by billionaire Anil Agarwal, is contemplating the revival of its copper plant in Tamil Nadu and exploring the option of selling the unit at a valuation of Rs 4,500 crore. Interestingly, the company had previously invited expressions of interest (EoIs) for the unit in June 2022 but failed to garner a positive response due to the plant’s closure over the past five years. Nonetheless, it seems the process has been reignited, with bankers now actively reaching out to potential bidders, according to an undisclosed source.
Curiously enough, Vedanta Ltd initiated the EoI invitation on June 12, citing the Supreme Court’s directive to “restart activities.” This move comes as a result of the Tamil Nadu Pollution Control Board’s order to shut down the plant. Eager to challenge the closure decision, Vedanta took the matter to the apex court, with the final verdict expected to be delivered by August.
Banking sources have revealed that Vedanta Resources (VRL), the parent company of Vedanta Limited, is making earnest efforts to raise funds in order to meet its debt repayment obligations. The proceeds from the unit’s sale, valued at Rs 4,500 crore, would contribute significantly to covering its capital expenditure of $1.7 billion for the current year, as highlighted in the report.
It is worth mentioning that industry analysts believe there are still other viable avenues available to Vedanta Ltd. These include dividend upstreaming, the recently approved domestic bond private placement of up to Rs 2,100 crore, and asset sales. VRL remains optimistic about fulfilling its debt obligations over the coming months, supported by its recent efforts to raise $1.3 billion. As of March 2023, VRL possesses $1.7 billion in short-term investments, encompassing various bank deposits, quoted bonds, and mutual funds. Experts at CreditSites speculate that these investments could be liquidated if the need arises, potentially impacting their market value.
In a peculiar twist, on the morning of June 22, Vedanta Ltd was observed trading 0.43 percent higher on the NSE at Rs 282.4.5, adding another layer of intrigue to this already perplexing situation.
