Goldman, Morgan Stanley among top investors in $1 billion Vedanta QIP

Mining conglomerate Vedanta Limited has raised ₹8,500 crore (over USD 1 billion) through a Qualified Institutions Placement (QIP) of 19.31 crore equity shares at an issue price of ₹440 per share, according to a recent stock exchange filing. This issue, which closed on July 19, offered a 4.61% discount to the floor price of ₹461.26 per equity share.

Prominent investors in this QIP include Abu Dhabi Investment Authority (ADIA), Goldman Sachs AMC, Nippon Mutual Fund, SBI Mutual Fund, UTI Mutual Fund, ICICI Mutual Fund, Aditya Birla Mutual Fund, and Mirae Mutual Fund. Notably, Nippon Mutual Fund received 9.11% of the total issue size, while Morgan Stanley and SBI Mutual Fund were allotted 8.62% and 7.88%, respectively.

Vedanta's chairman, Anil Agarwal, highlighted the strong investor confidence in the company's strategic growth and operational excellence. The funds raised will aid in de-leveraging Vedanta’s balance sheet and support the company's near-term target of achieving $10 billion EBITDA.

The QIP saw substantial interest from foreign institutional investors, mutual funds, insurance companies, and other investors. The proceeds will also support Vedanta’s various growth projects, including an aluminium smelter and refinery, new oil and gas investments, and expansion of its steel and iron ore businesses. These initiatives are key to driving Vedanta's targeted financial performance, with the company already posting strong annual figures for FY24, including a consolidated revenue of ₹1,41,793 crore and an EBITDA of ₹36,455 crore.

In a strategic move to unlock value and attract significant investment, Vedanta announced plans to demerge its business units into independent pure-play companies, which will include aluminium, oil & gas, power, steel and ferrous materials, and base metals. This demerger aims to create focused entities for growth and expansion, while the existing zinc and new incubated businesses will remain under Vedanta Limited.