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Informist, Wednesday, Aug. 20, 2025

--Vedanta: Filed detailed response to govt's representation in NCLT

NEW DELHI – Vedanta Ltd. has filed a detailed response to the government's representation in the National Company Law Tribunal hearing on Wednesday on the proposed demerger of the company, Vedanta said in a statement. The company has informed the tribunal that it will issue a corporate guarantee in favour of the petroleum and natural gas ministry "once the (demerger) scheme becomes effective," the statement said, quoting a spokesperson.

The corporate guarantee will be in case Vedanta's wholly-owned subsidiary Malco Energy Ltd. "is unable to meet or satisfy potential contractual liability, if any, towards" the petroleum and natural gas ministry "arising under the Production Sharing Contracts and Revenue Sharing Contracts (pertaining to the oil and gas blocks)," the spokesperson said in the statement. CNBC-TV 18 reported earlier Wednesday that the government told the tribunal that there was concealment and non-disclosure of key details by Vedanta. The government also flagged concerns over inflated revenue and concealed liabilities of the company, the news report had said.

Malco Energy reported a revenue of INR 8.77 billion and a net loss of INR 1.88 billion for 2024-25 (Apr-Mar), data from Vedanta's annual report showed. Malco Energy had total assets of INR 9.28 billion and liabilities of INR 12.08 billion as of Mar. 31. 

Vedanta's demerger scheme, pending statutory and regulatory clearance, involves the demerger of the company's aluminium, oil and gas, and iron ore and steel businesses into separate companies - Vedanta Aluminium Metal Ltd., Malco Energy Ltd., and Vedanta Iron and Steel Ltd. The company had filed a separate application with the National Company Law Tribunal for demerging the power segment into Talwindo Sabo Power Ltd. According to Vedanta, the proposed demerger "is a strategic step to unlock long-term value by creating sector-focused, pure-play businesses with independent management teams."

CNBC-TV 18 had also reported that the government submitted to the tribunal that Vedanta had modified the demerger scheme after a no-objection certificate was granted by the Securities and Exchange Board of India. The news report said SEBI has confirmed that the modification of the merger scheme post the no-objection certificate was a serious breach of rules. Vedanta's spokesperson said SEBI has confirmed it has no further comments on the merits of the demerger scheme, and it had issued an administrative cautionary letter over a procedural lapse.

On Wednesday, shares of Vedanta ended at INR 445.50 on the National Stock Exchange, down 1.0% from the previous close.  End

Reported by Rajesh Gajra

Edited by Saji George Titus

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