Mumbai-based brokerage Nuvama said in a note that Vedanta Limited is “irresistible” at the current market price, and expects a sharp revival in the company’s stock price.
The firm, which has a target price of Rs 601 on Vedanta, said that the critical minerals, transition metals, energy and technology conglomerate is the biggest beneficiary of rising commodity prices. Nuvama’s price target represents an upside of almost 28% on Vedanta’s closing price of Rs 471.35 (BSE) on Friday. With its strong positioning across commodities, Vedanta stands out as a potential wealth creator for investors.
Nuvama estimates Vedanta’s EBITDA compounded annual growth rate between FY25 to FY27 to be 20%. “At current LME prices, FY27 EBITDA can increase by ~12% to INR 703bn and price target can increase by 20% to INR 726,” said Nuvama.
The brokerage expects Vedanta’s ongoing demerger to be another positive, contributing to value unlocking. It noted that the NCLT hearing related to the demerger is expected to be concluded soon. “If that happens, all uncertainties related to demerger will go away and it can be concluded in Q4FY26, unlocking value,” the firm said.
As per the brokerage, Vedanta’s focus on deleveraging, cost leadership and volume expansion are among the key positives.
“Expansion of alumina (1.5mtpa) to be concluded in Q3FY26 making it >90% self-sustainable in alumina at peak capacity in FY27.” Nuvama said.
Volume growth in aluminium to accrue from H2 FY26 and International zinc from FY27 onwards, Nuvama said, adding that Vedanta continues to be a high dividend yield company, with the brokerage expecting dividend per share of INR 25 in FY27 as well as FY28.
The stock of Vedanta Ltd., which is India’s largest producer of silver (through Hindustan Zinc) has rallied over 7% in the last one month (September 3- October 3), taking its market capitalisation to over Rs 1.84 lakh crore. The company is also gaining from the surge in silver prices, and a global rally in copper, where the supply has been hit by the impact of mishaps and accidents at key mines in Indonesia and Latin America.
It has proposed a demerger which will result in creation of sector-specific independent companies in the aluminium, oil and gas, iron and steel and power segments while certain remaining and new businesses will be under Vedanta Ltd.
