Vedanta Limited’s chairman, Anil Agarwal, has reaffirmed the company’s commitment to harnessing India’s natural resources as it moves forward with its demerger plan. In a letter addressed to stakeholders, Agarwal emphasized the importance of India’s mining and natural resource sector in driving economic growth, drawing comparisons to global economies that have capitalized on their mineral wealth.
Demerger to unlock value and drive expansion
Vedanta’s demerger aims to establish four independent entities, each with its own management, capital structure, and strategic focus. Agarwal believes this move will position each entity for significant growth, enabling them to scale up and contribute more effectively to India’s economic and industrial expansion.
The company has stated that post-demerger, shareholders will receive one new share in each of the demerged companies, with no change in the overall shareholding structure. Vedanta expects the move to unlock significant shareholder value, with each new company having the potential to grow into a $100 billion entity.
Shareholder confidence and industry outlook
The demerger plan has already received overwhelming support from shareholders and creditors, with 99.5% voting in favor of the restructuring. Vedanta, which currently contributes about 1.4% to India’s GDP, sees this as an opportunity to create a globally competitive sector while reducing India’s import dependency.
The company remains bullish on India’s growing demand for key minerals, including aluminum, copper, and zinc, which are crucial for a low-carbon future and expanding industrial base. By aligning itself with global trends and strengthening its domestic operations, Vedanta aims to reinforce its position as a leader in the natural resources sector.
Agarwal also highlighted Vedanta’s strong financial performance, noting that an investor who placed funds in Vedanta five years ago would have seen their investment grow by 4.7 times, driven by capital appreciation and dividends.
As Vedanta moves towards executing its demerger strategy, it remains committed to fostering growth, job creation, and long-term value for stakeholders in India’s resource-driven economy.
