Ind-Ra upgrades Vedanta’s NCD rating with a rider – CNBC TV18

India Ratings and Research has upgraded Vedanta Ltd’s non-convertible debentures (NCDs) to ‘IND AA-/rating watch with developing implications,’ reflecting improved financial flexibility at the group level.

The agency highlighted the successful refinancing efforts by Vedanta Resources Limited (VRL), which reduced its reliance on high-cost debt and eased liquidity pressures.

The recent overseas fundraising has provided crucial relief for VRL, reducing interest costs, elongating debt tenures, and improving bond covenants. Unlike older issuances, the new bonds do not carry acceleration clauses, which further supports the group’s financial stability.

Also read: Vedanta Resources signs refinancing facility of $1.25 billion

India Ratings also expects Vedanta’s financial leverage to improve significantly post-FY27, backed by better EBITDA contributions from its aluminium business and operational efficiencies across its zinc and oil and gas segments.

However, the ‘developing implications’ tag on the rating reflects the uncertainty surrounding the ongoing demerger process. Vedanta is in the process of splitting its business into six standalone entities, a move currently under the National Company Law Tribunal (NCLT) for approval.

While the agency does not foresee a deterioration in the credit profiles of the demerged entities, higher-than-expected debt allocation to any of them could negatively impact ratings.

Separately, Vedanta announced its fourth interim dividend of ₹8.5 per share for FY25, with the record date set for December 24. This announcement was made after market hours.

Also read: Vedanta declares fourth interim dividend of ₹8.5 per share; Promoters to get ₹1,874 crore

Vedanta’s stock ended 1.21% lower at ₹513.40 on the BSE, off its record high of ₹527 hit earlier in the session. The company’s market capitalisation stood at ₹2 lakh crore, with a turnover of ₹41.21 crore recorded during the day.