Vedanta announces 2nd dividend of ₹19.5 apiece; stock rises 1%

Anil Agarwal-led Vedanta Ltd has announced its second interim dividend of ₹19.5 per share for the financial year 2022-23. The metals and mining company's total payout would stand at ₹7,250 crore.

"The board of directors of the company through a resolution passed by circulation on Tuesday, July 19, 2022, have approved a second interim dividend of ₹19.50 per equity share i.e. 1,950% on the face value of Re. 1/- per share for the financial year 2022-23 amounting to ₹7,250 crores," Vedanta says via a stock exchange filing.

The company has set July 27, 2022, as the record date for the dividend payment. Before this, Vedanta had announced an interim dividend of ₹31.5 per share on May 6, 2022, and an interim dividend of ₹13.5 per share on December 17, 2022.

The announcement by the company came after the market hours, though the stock rose 1.03% to ₹239.90 on the National Stock Exchange today, in line with BSE Sensex which ended 0.45% higher. Vedanta shares have fallen 26.67% in the past six months; 32.19% in the year-to-date period; and about 6% in the past one year from a 52-week high of ₹437.75 on April 11, 2022.

Vedanta Ltd, a subsidiary of Vedanta Resources Ltd, has interests in zinc-lead-silver, iron ore, steel, copper, aluminium, power, nickel, and oil and gas. With a total workforce of 76,000, Vedanta has strategic assets in India, South Africa and Namibia.

In its annual report released on July 15, 2022, Vedanta said under its dividend policy, a minimum of 30% of attributable profit after tax will be distributed as dividends. The company had approved the first interim dividend of ₹18.50 apiece; the second interim dividend worth 13.50 apiece; and the third interim dividend worth ₹13 apiece for FY22.

In his note to shareholders, Agarwal, who's non-executive chairman of Vedanta Ltd, said there is significant space for import substitution of minerals such as zinc and oil & gas, where India freely allows imports for domestic consumption. "Our strong liquidity position and deleveraging focus peg our debt at a very comfortable level. Reflecting this, both CRISIL and India Ratings upgraded our credit rating to ‘AA’ with a stable outlook."

Besides in June, Vedanta ventured into international iron ore mining operations in Liberia, West Africa, through its subsidiary Western Cluster Limited, Liberia (WCL). WCL is a subsidiary of Bloom Fountain Limited (BFL) which is, in turn, a wholly-owned subsidiary of Vedanta Limited.