According to sources cited in a Reuters report, Vedanta Ltd is on the brink of embarking on a substantial restructuring, with plans to divide into four distinct units. An official announcement concerning this strategic move is expected to be made later this week. It is anticipated that Vedanta will establish separate entities for its metals, power, aluminum, and oil and gas operations.
The primary motivation behind this decision to spin off these units is to unlock greater valuation for each of these segments. Vedanta Ltd appears to be strategically repositioning itself, seeking to adopt a more focused approach within each of its core sectors. This strategic shift holds the potential to result in enhanced operational efficiency and improved financial performance across these business divisions.
Just a month ago, Chairman Anil Agarwal had alluded to the possibility of demerging the company's diverse businesses. This strategic move aligns with his vision of potentially pursuing separate listings for some, if not all, of Vedanta's business entities.
Agarwal's overarching goal is to provide investors with the opportunity to hold shares in distinct and diversified entities. According to his vision, this approach is expected to open up new avenues for investment across various sectors, thereby enabling shareholders to have a more diversified portfolio.
In the wake of Moody's downgrade of its parent firm, Vedanta Resources Limited, Vedanta Ltd witnessed a significant decline in its shares during the previous session. However, reports of the impending demerger of its businesses have sparked renewed interest in the company's shares.
As of 1:35 p.m., Vedanta shares had registered a 0.45 percent increase, trading at Rs 209.95 apiece.
