Vedanta Ltd., controlled by Anil Agarwal, announced its second interim dividend of FY23–24 on Monday, valued at Rs. 11 per share, among financial constraints. The sum spent on this operation is Rs 4,089 crore, and the record date for dividend payments is December 27, 2023.
The largest beneficiary of this distribution would be Vedanta Resources (VRL), the parent company of Vedanta, which has a 63.71% interest in the listed business.
It is anticipated that the London-based corporation would be paid out in dividends somewhat more than Rs 2,600 crore. The announcement of a second dividend by the mining behemoths coincides with the market, financial institutions, and credit rating agencies closely monitoring the company’s debt repayment date.
In January 2024, the heavily laden corporation will have to repay up to $1 billion.
Anirudh Garg, a partner and fund manager at INVAsset, said that the $1 billion debt payback that is scheduled for January 2024 comes before this prompt dividend decision.
“Vedanta is a leader in debt reduction beyond dividend payments; in the first year, the company paid down all of its obligations until March 2023 and half of its three-year debt reduction goal of $4 billion. Their commitment to financial health is shown by their debt management, which includes a significant $2 billion deleveraging in the last year, said Garg.
Vedanta authorized its first dividend earlier this year at Rs 18.5 per share, for a total distribution of Rs 6,877 crore. The firm distributed five dividends in FY 2023.
Days after sister company Hindustan Zinc announced a dividend of Rs 6 per share, another dividend announcement has been made. In the calendar year 2023, Hindustan Zinc began trading ex-dividend on this day.
In addition to the dividend route, Vedanta’s parent company, VRL, disclosed last week that it has signed a new credit facility and a refinancing facility valued at $1.25 billion.
The firm said that the financing would provide “a long-term sustainable capital structure for the company,” but it did not reveal the identities of the lenders.