Investec has reiterated its ‘Hold’ rating on Vedanta, with a target price of ₹510. The brokerage highlighted Vedanta’s recent $800 million debt refinancing as a key development, allowing the company to elongate its debt maturity profile and reduce interest costs. This move effectively reduces the immediate payout pressure, providing the company with greater operational flexibility.
While Investec views the refinancing as a positive step, it emphasized that a clear capital allocation framework, including a defined payout policy, could significantly enhance investor confidence and boost valuations. Vedanta’s ambitious cost targets were also highlighted, with the brokerage describing them as aggressive.
This comes as Vedanta continues to face challenges in maintaining investor sentiment amid volatile commodity prices and concerns over debt obligations. Analysts believe that while the refinancing is a step in the right direction, Vedanta’s ability to deliver on cost and growth targets will remain pivotal to its re-rating potential.
