Vedanta Shares Soar to New High as Demerger Plan Gets NCLT Approval: What Investors Need to Know

Vedanta's stock price reached a new record high following the National Company Law Tribunal's (NCLT) approval of the company's demerger plan. The stock experienced a surge, climbing as much as 1.92% to achieve its all-time high.

Fueling the upward trend, the stock has risen by 9% over the past five trading sessions. Shares of Vedanta saw a notable increase on Tuesday, particularly in the last hour of trading, after the NCLT order. The stock closed 4.2% higher at ₹572.50 on the NSE.

Vedanta has stated that this approval moves them into the execution phase of a significant demerger. This is, however, subject to the receipt of necessary governmental and regulatory approvals, along with clearances from other stakeholders. The demerger will result in five separate publicly traded companies, including the already-listed Vedanta Limited. Each entity will have a distinct strategic focus, dedicated management teams, and specific capital structures.

**Demerger Details**

The primary goal of the demerger is to unlock long-term value for Vedanta's shareholders. It will also provide investors with direct access to high-quality assets in sectors aligned with India's growth and the global shift towards energy transition.

Vedanta views this move as a major simplification of its corporate structure. The company also expects it to improve accountability, transparency, and strategic clarity across its various business operations.

**The Five New Entities**

Following the demerger, Vedanta's current businesses will be reorganized into independent companies, each concentrating on a specific sector. This structure is designed to allow each company to better leverage its unique market opportunities. The five entities will be:

• Vedanta Aluminium
• Vedanta Oil & Gas
• Vedanta Iron & Steel
• Vedanta Power (*Note: The demerger of Vedanta Limited's merchant power business is still awaiting NCLT approval under a separate process.*)
• Vedanta Limited (which will continue as the parent company, housing Hindustan Zinc Limited and incubating future businesses)

**What This Means for Shareholders**

According to Vedanta's press release, shareholders will receive equity shares in each of the four newly listed entities. This distribution will be proportional to their existing holdings in Vedanta Limited. Shareholders will retain their current ownership in Vedanta Limited itself. This ensures continued ownership while enabling direct participation in the growth of each individual business.

**Strategic Benefits**

Each of the demerged entities will benefit from greater strategic flexibility. They will also have a sharper focus on their respective markets and independent access to capital. Management teams within each entity will be able to make decisions more closely aligned with customer needs, investment cycles, and the dynamics specific to their commodities. This will allow investors to more accurately evaluate and value each business based on its individual performance.

The new companies will be well-positioned to capitalize on India's ongoing infrastructure development, rapid urbanization, energy transition, and the increasing emphasis on domestic manufacturing and resource security. The structure should allow each company to respond quickly to these trends while maintaining disciplined growth and operational excellence.

**Chairman's Perspective**

Anil Agarwal, Chairman of Vedanta Ltd, stated that the NCLT's approval is a "landmark moment" in Vedanta's history. He believes it reinforces the company's vision of creating focused, world-class companies that are well-aligned with India's growth ambitions and the evolving global demand for resources, energy, and technology.

Agarwal added that each entity has the potential for significant growth and can attract strategic investment, delivering superior value in sectors experiencing double-digit growth. He emphasized that the demerger is also about empowering leadership and ensuring a deep commitment to sustainable growth across all companies.