Vedanta stocks in focus amid board meet on NCDs, report of parent loan talks
Vedanta stocks: Vedanta shares would be in focus as the board of directors of the company will consider a proposal for issuance of non-convertible debentures (NCDs) on a private placement basis.
Shares of Vedanta Ltd will be in focus on Thursday morning amid a media report that suggested the London-based parent Vedanta Resources is in advanced talks with global private credit funds including Bain Capital, Davidson Kempner, Ares SSG Capital and Cerberus Capital, to syndicate a $1 billion short-term loan. The report by the ET quoting two sources suggested the loans would be utilised for part-paying $3.2 billion of bonds maturing in 2024 and 2025,
Vedanta shares would also be in focus as the board of directors of the company will consider a proposal for issuance of non-convertible debentures (NCDs) on a private placement basis as part of its routine refinancing that is undertaken in ordinary course of business.
As per the ET report, the patent company has $1 billion of 13.875 per cent bonds coming up for repayment in January, another $1 billion of 6.125 per cent paper due in August 2024. Besides, $1.2 billion of 8.95 per cent bonds would be maturing in March 2025.
Parent Vedanta Resources’ high leverage and funding gap of $3 billion in FY2025 has made investors cautious. Kotak Institutional Equities in a recent noted said they are key areas of concern and overhang.
It however noted that Vedanta Resources has largely addressed the funding gap of FY24 via one-time measures such as selling 6 per cent stake in Vedanta. It said the $2.2 billion bonds maturity in FY25 could be a taller hump.
Kotak siad large dividends are no longer possible and Vedanta Resources might be forced to divest stake or assets in Vedanta. The bleak commodity cycle suggests a downside risk to earnings, it said.
With Thanks Reference to: https://www.businesstoday.in/markets/company-stock/story/vedanta-stocks-in-focus-amid-board-meet-on-ncds-report-of-parent-loan-talks-399125-2023-09-21
