Vedanta Resources Raises $500 Million Via Bond Issuance: A Strategic Move
Anil Agarwal-led Vedanta Resources Ltd (VRL) has raised $500 million through bonds in October, marking a significant step in its deleveraging roadmap. The company will use the proceeds to repay near-term obligations, including a $550 million Private Credit Facility (PCF).
Deleveraging Roadmap
As per the letter to the bondholders, the company stated that ‘the average maturity of its debt portfolio is now over four years, and it has reduced its weighted average interest cost to single digits, reflecting a stronger, more resilient capital structure’. This move is expected to have a positive impact on the company’s stock prices and overall financial health.
Robust Liquidity
The company maintains robust liquidity, supported by dividend inflows from operating subsidiaries and healthy free cash generation. Additionally, Vedanta Resources has tied up a $500 million term loan facility with a consortium of leading global and Indian banks, and it maintains a long-term loan facility with undrawn balances of $682 million.
Core Businesses
Operationally, Vedanta’s core businesses of zinc, oil and gas, aluminium, and power continue to deliver strong EBITDA and cash flows. Commodity prices have remained resilient despite global trade disruptions, supporting profitability.
Demerger and Financial Discipline
The ongoing demerger of Vedanta Limited into five independent sector-specific entities is progressing as planned, with the aim of unlocking value, enhancing transparency, and enabling sharper capital allocation. The company reaffirmed its commitment to financial discipline, stating that it will continue to honour all debt obligations and sustain its deleveraging trajectory through internal accruals, strategic refinancing, and capital optimisation.
Debt Reduction
Vedanta Resources has reduced its debt by more than $4 billion since FY22, with total gross debt falling from $9.1 billion in fiscal 2022 to $4.8 billion as of June 2025. The company has also focused on consolidating its debt, which has helped in creating a robust capital structure, providing it with strong access to capital markets across the group and longer tenor issuances.
Investor Sentiment
The company’s efforts to reduce debt and strengthen its capital structure are expected to have a positive impact on investor sentiment. With a strong focus on disciplined capital management and long-term value creation, Vedanta Resources is well-positioned to navigate the challenges of the Indian stock market.
