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India’s Vedanta to Raise $120 Million via Debt Issue

Vedanta Limited (NYSE: VEDL), the Indian conglomerate spanning metals to oil, announced plans to raise up to 10 billion rupees (approximately $120 million) by issuing non-convertible debentures through a private placement. This move is part of a broader strategy by the company, led by billionaire Anil Agarwal, to bolster its financial standing.

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Recent Fundraising Approvals

Over the past two months, Vedanta’s board has approved raising up to $300 million through debentures and an additional up to $1 billion, though the specifics of this larger fundraising effort are still being finalized.

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Financial Overview

Net Debt: As of March 31, Vedanta’s net debt increased by 25%, reaching 563.38 billion rupees.

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Cash and Cash Equivalents: The company’s cash and cash equivalents dropped to 28.12 billion rupees, a significant decrease from 69.26 billion rupees a year earlier.

Strategic Initiatives

Vedanta is currently undergoing a significant restructuring, splitting into six different units. This reorganization is aimed at improving the financial performance of the group. As part of its growth strategy, Vedanta plans to expand its capacity in the steel and aluminum sectors.

Capital Expenditure

For fiscal year 2025, Vedanta has proposed a capital expenditure of $1.90 billion, which is an increase from the $1.4 billion allocated the previous year. This investment is primarily focused on enhancing its steel and aluminum production capabilities.

Market Reaction

Following the announcement, Vedanta’s shares rose by 5.5% in late morning trading.

The fundraising and strategic restructuring reflect Vedanta’s commitment to strengthening its financial position and expanding its core business operations in the coming years.

(Conversion rate: $1 = 83.5070 Indian rupees)

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