Vedanta shares gain after first interim dividend announcement for FY24

Shares of Anil Agarwal-led Vedanta Limited surged as much as 1.9% to hit an intraday high of ₹293.05 apiece on the BSE on Tuesday, a day after the company announced the first interim dividend for FY24.

The scrip opened higher at ₹292.65 against the closing price of the previous session at ₹287.35, in line with the broader BSE Sensex which opened 0.21% higher on Tuesday. During the session, the company's market capitalisation stood at ₹1.07 lakh crore with over 7.13 lakh shares exchanging hands over the counter, higher than the two-week average volume of 5.36 lakh shares. At the current price level, the stock is trading 15.06% lower than the 52-week high of ₹340.75, which the company hit on January 20 this year. Shares of the mining giant are trading 40.3% higher than the 52-week low of ₹206.10, which the company touched on July 7 last year.

On Monday, the company approved the first Interim Dividend of ₹18.50 per equity share i.e. 1850% on face value of ₹1/- per share for the Financial Year 2023-24 amounting to ₹6,877 crores. The record date for the purpose of payment of dividends is Tuesday, May 30, 2023. The interim dividend will be paid within stipulated timelines as prescribed under law, the company said in a regulatory filing. In the financial year 2023, Vedanta declared a total dividend of ₹101.50 per share, which amounted to ₹37,730 crore, the highest ever by the company. The metal and mining company declared five interim dividends in FY23- ₹31.50 in May, ₹19.50 in June, ₹17.50 in November, ₹12.50 in February, and ₹20.50 in March.

As per the latest shareholding pattern available on the BSE, the Agarwal family's Vedanta Resources holds a 68.11% stake in Vedanta, while retail and other investors own 11.4% shares in the company. Besides, domestic institutions and foreign institutions hold 9.82% and 7.9% stakes in the mining major, while the remaining 1.19% of stocks are owned by mutual funds. It is notable that Vedanta promoters have pledged 99.9% of their holding in the company to raise money.

The metal and mining company, which operates iron ore, gold, and aluminium mines in Goa, Karnataka, Rajasthan, and Odisha, is likely to use the dividend proceeds to repay its debt. As of March 31, 2023, the company had a gross debt of ₹66,182 crore and net debt of ₹45,260 crore. The cash and cash equivalents position stood at ₹20,922 crore.

In Q4 FY23, Vedanta reported a 67.5% year-on-year drop in its net profit at ₹1,881 crore, while revenue from operations dropped 5.4% YoY to ₹37,225 crore.