Vedanta's Growth Journey: Unlocking Value Through Strategic Demerger and Expansion

Vedanta is projected to achieve a 16% CAGR in EBITDA through FY28 due to capacity expansions and strategic demergers. Key projects in zinc, aluminium, and power sectors are set to drive growth, with the demerger into five entities enhancing investor value and aiding de-leveraging efforts.

Mining giant Vedanta is poised for a 16% compound annual growth rate in EBITDA through FY28, according to brokerage Nuvama. This growth is largely driven by newly commissioned capacities and increasing production volumes in aluminium, zinc, and power sectors.

Vedanta's strategy of focusing on demerger, delivery, and deleveraging, supported by favorable commodity prices, is expected to yield positive results. A significant reduction in aluminum production costs coupled with rising volumes is anticipated. By the end of FY27, net debt is projected to decrease to Rs 61,000 crore.

The company's strategic move to demerge into five distinct entities will provide investors opportunities to invest in specific commodities, potentially unlocking greater value. Notable upcoming projects include significant expansions in zinc and power, with expected benefits from improved LME pricing dynamics.

(With inputs from agencies.)