Vedanta Ltd. shares staged a recovery after the company announced its board will meet to consider a second interim dividend. The stock, which initially declined 0.53% to ₹443.15, rebounded to trade 0.24% higher at ₹446.25.

Dividend Consideration

The company's board is set to meet to consider a second interim dividend, with a potential record date of August 27. This announcement comes as a positive development for shareholders, potentially offsetting recent market concerns.

Recent Stock Performance

Vedanta's share price had experienced a drop in the previous trading session following the National Company Law Tribunal's deferral of the proposed demerger hearing. Over the past 12 months, Vedanta shares have declined 1.91% and are down 0.38% year-to-date.

Demerger Plans and Regulatory Concerns

Vedanta is proceeding with plans to split into four separate entities focusing on aluminum, power, gas, oil, and base metals. However, the Securities and Exchange Board of India (SEBI) has raised concerns about changes in the arrangement scheme. The demerger hearing is now scheduled for September 17, adding a layer of uncertainty to the company's restructuring plans.

Analyst Outlook

The stock maintains a generally positive outlook among analysts:

• 10 out of 15 analysts covering the stock maintain buy ratings
• 4 recommend hold
• 1 suggests sell

The average price target implies a 12.6% upside potential, indicating analyst confidence in the company's future performance despite recent challenges.

Legal Update

According to the latest LODR data, Vedanta's wholly-owned subsidiary, Talwandi Sabo Power Limited (TSPL), faced a setback in its legal battle. The Supreme Court upheld the ruling of the Appellate Tribunal for Electricity (APTEL) regarding TSPL's entitlement to Foreign Trade Policy benefits on account of mega power status. Vedanta stated that they are reviewing the judgment and evaluating the next steps, including potential legal options.

This legal development adds another dimension to Vedanta's ongoing corporate activities and may have implications for the company's financial outlook in the power sector.

As Vedanta navigates through these corporate and legal challenges, investors will be closely watching the outcome of the upcoming board meeting and the potential dividend announcement, which could provide a boost to shareholder confidence.

Shares of Vedanta Limited fell over 2% on Tuesday following a series of setbacks related to the company's proposed demerger plan. The decline came as the National Company Law Tribunal (NCLT) postponed hearings on the demerger to September 17, amid objections from the Central Government and a warning from the Securities and Exchange Board of India (SEBI).

Vedanta Refutes Claims of Stopped Demerger

Vedanta has refuted claims suggesting that its demerger process has been stopped. The company made this clarification in response to circulating reports about the status of its corporate restructuring initiative.

Government Raises Concerns

The Central Government has raised objections to Vedanta's demerger plan, citing potential hindrances to the recovery of dues. The government also alleged that the company concealed key information, inflated revenues, and had undisclosed liabilities. These concerns have cast a shadow over the company's restructuring efforts.

SEBI's Administrative Warning

In a separate development, SEBI issued an administrative warning to Vedanta for making modifications to the demerger scheme after receiving a No Objection Certificate. The market regulator termed this action a "serious breach," further complicating the company's demerger process.

Demerger Plan Details

Vedanta had announced its demerger plan in September 2023, proposing to split the company into four separate entities:

1. Aluminium
2. Oil and Gas
3. Power
4. Base Metals

The completion deadline for this restructuring was extended to September 30, 2025, highlighting the complexity of the process.

Upcoming Board Meeting

Despite the ongoing challenges, Vedanta's board is scheduled to meet on August 21 to consider a second interim dividend. The company has set August 27 as the record date for this potential dividend.

Market Reaction

The market responded negatively to these developments, with Vedanta's shares dropping more than 2% in trading. Investors appear to be cautious about the company's future amid the regulatory and governmental scrutiny.

Recent Corporate Disclosure

In a recent corporate filing, Vedanta's subsidiary, Bharat Aluminium Company Limited (BALCO), received a penalty order from the Income Tax Department. The order, dated August 18, levies a penalty of Rs. 80.96 lakh for the Assessment Year 2012-13. BALCO intends to file an appeal against this order, expressing confidence in a favorable outcome.

The series of events surrounding Vedanta's demerger plan and the recent regulatory actions have created uncertainty for investors. As the situation unfolds, market participants will be closely watching for further developments and the company's response to these challenges.