Vedanta Demerger: Check record date, demerger ratio, other key things to know

Mining major Vedanta announced that the record date to determine the eligibility of shareholders for its much-awaited demerger has been set on May 1, and approved the demerger ratio for each of the newly carved-out businesses.

In an exchange filing released on Monday, Vedanta announced that each of its eligible shareholders will get one share of Vedanta Aluminium Metal Ltd (VAML), one share of Talwandi Sabo Power Ltd (TSPL), one share of Malco Energy and one share of Vedanta Iron and Steel, for every share held in Vedanta.

So in other words, Vedanta shareholders will get one share in each of the four new entities for each share of Vedanta they hold on the record date, which is May 1. It is important to note that shareholders willing to participate in the demerger scheme must buy the shares of Vedanta before the record date in order to be eligible to receive the shares in the four new companies.

Additionally, Vedanta announced that as part of the overall restructuring, Talwandi Sabo Power Limited and Malco Energy Limited will be renamed to ‘Vedanta Power Limited’ and ‘Vedanta Oil and Gas Limited’ respectively.

Vedanta’s long-awaited demerger plan received approval from the National Company Law Tribunal (NCLT) in December last year. When Vedanta first announced its demerger plan in 2023, it had proposed splitting its Indian operations into six separately listed companies, including a standalone base metals entity. Over time, the structure was revised. Under the approved scheme, the base metals business will remain within a restructured Vedanta, while four new listed companies will be carved out. The restructured Vedanta will continue to house the zinc and silver businesses through Hindustan Zinc and is envisaged as an incubator for future ventures. The demerger has seen significant delays, largely due to objections raised by the government.

Earlier last month, Vedanta Chairman Anil Agarwal told the Financial Times that the long-delayed restructuring could create “phenomenal shareholder value”. Agarwal told the FT that the new entities emerging from the conglomerate will have a free hand to grow. A privately held parent company controlled by Agarwal will retain roughly half the shareholding in each of the demerged entities, he added.

The industrialist further said in his interview with the FT that the restructuring could sharply re-rate the group’s market value. “The combined market capitalisation of the five companies would be much higher. People are saying that, comfortably, it should double,” he said. Vedanta’s total market cap currently stands at over Rs 3 lakh crore.

Vedanta shares jumped more than 3% to hit a fresh 52-week high of Rs 795 apiece on Tuesday after the demerger announcement.


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