Vedanta shares in focus on Tuesday after Vedanta Resources Ltd (VRL) issued two sets of bonds totaling up to $1.25 billion, with a 3.5-year term at 10.25% and a 7-year term at 11.25%. According to reports, the funds will be used to refinance the company's outstanding 13.875% notes, which mature in 2028.
Vedanta Resources Finance II PLC issued the bonds. The bonds are fixed-rate senior unsecured guaranteed notes issued under 144A/Regulation S. The company had set a price guide of 10.375%, but was able to close the 3.5-year bond at 10.25% and the 7-year bond at 11.25%.
Last month, the business raised $300 million at 9.99%.
The bonds, guaranteed by Vedanta Resources Ltd. and its subsidiaries TwinStar Holding and Welter Trading, have a semi-annual fixed coupon.
The bond offering is part of Vedanta's overall plan for managing its $4.8 billion debt obligations, which include $3 billion in bonds, $1 billion in bank loans, and a $850 million private credit facility.Last week, the company paid back $295 million of its bonds at par. If there is enough money, a second redemption of its 2028 notes is planned for December 20 this year.
The average target price for the stock is Rs 515, which represents a 16% increase over current market levels, according to Trendlyne figures. Fifteen analysts have given the stock a consensus rating of "Buy."
On Monday, Vedanta's shares closed at Rs 444.15, down 0.2% on the BSE, while the benchmark Sensex rose 1.25%. Its shares have up 72% in 2024 and 40% in the last two years, with a market valuation of Rs 1,73,679 crore.
