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Informist, Friday, Dec. 19, 2025

 

--Fitch revises Vedanta Resources' rating outlook to positive from stable 

 

NEW DELHI – Fitch Ratings has raised its outlook on Vedanta Ltd.'s UK-based holding company, Vedanta Resources Ltd., to 'positive' from 'stable' on expectations of rising earnings before interest, tax, depreciation, and amortisation, falling leverage, and stronger financial discipline. The rating agency affirmed the company's long-term foreign currency issuer default rating at 'B+'.

 

"The positive outlook reflects our estimate that VRL's (Vedanta Resources) proportionately consolidated EBITDA net leverage may reduce to around 3.2x or lower for a sustained period," Fitch Ratings said in a release dated Thursday. "This will be driven by our increased short-to-medium term commodity price assumptions for zinc, aluminium and silver, the improving backward integration in VRL's aluminium business, and management commitment towards deleveraging," the rating agency said.

 

According to Fitch Ratings' estimate, zinc, aluminium, and oil and gas segments contributed almost 90% of Vedanta Resources' adjusted-consolidated EBITDA of around $5.3 billion in 2024-25 (Apr-Mar). Vedanta Resources holds a 56% stake in Vedanta Ltd.

 

The 'B+' rating reflects risks related to the company governance and group structure and a 'moderate' business profile, Fitch said. "It also factors in manageable liquidity risks at the holding company, comprising VRL and other offshore investment holding companies owned by VRL," the firm said. 

 

Fitch Ratings noted that Vedanta Resources has a small board of three directors, two of whom are members of the founding family. In addition, Vedanta Ltd.'s 8-member board has three members from the founding family, and two of the four independent directors are former Vedanta Resources executives.

 

"The higher importance of our management and corporate governance assessment on VRL's rating navigator weighs on its rating. The rating could have been higher otherwise, considering VRL's business profile strengths," Fitch said.

 

Vedanta Resources had about $5.2 billion in debt as of October. "We expect VRL to meet the debt maturities through dividends from its opcos (operating companies) and/or refinancing, given improved funding access. Potential sales of stakes in listed opcos provide additional buffers," Fitch said. 

 

Vedanta Ltd. reported a consolidated net profit of INR 17.98 billion for the September quarter on revenue of INR 398.68 billion. Friday, its shares closed 0.4% higher on the National Stock Exchange at INR 581.60.  End

 

US$1 = INR 89.27

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Anand JC

Edited by Saji George Titus

 

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