Vedanta declares dividend of Rs 19.5 per share in boost to London parent

Vedanta Ltd. will pay a dividend of Rs 7,250 crore ($907 million) to shareholders in a move that will help its debt-heavy parent, which is grappling with soaring bond yields of as much as 40%. 

The unit of Anil Agarwal’s metals and oil conglomerate said it will pay Rs 19.5 per share, according to an exchange notice Tuesday. Its controlling shareholder, London-based holding vehicle Vedanta Resources Ltd., owns about 70% of the Indian firm, which is its main asset. 

The dividend is key for its parent, which has seen its bonds fall the most in June since the early months of the pandemic in 2020, amid concerns that the risk of an economic recession may put more pressure on commodity prices, and impact the worth of its assets.

Dividends going to Vedanta Resources from Vedanta Ltd. totaled about $1.5 billion in fiscal 2022, with an additional $932 million in April, according to Bloomberg Intelligence. 

    

The hefty dividend comes even as the firm plans to ramp up capital investment to as much $2 billion in the year ending March 2023, higher than any of the previous six periods, according to an investor presentation in April.  
 

Vedanta’s dividend closely follows a similar decision by its own cash-rich unit, Hindustan Zinc, to send $1.1 billion in cash up to its shareholders through dividends.  

Mumbai-listed Vedanta’s share price has fallen by about 45% from its peak in April. It closed 0.6% higher on Tuesday.