Vedanta, Hindustan Zinc Shares Decline by 1% Following Enforcement Directorate Visit to Company Offices

Vedanta Shares Fall 1% Amid FEMA Investigation

Shares of Vedanta and its subsidiary Hindustan Zinc declined 1% each on Wednesday, 3 June, after the company confirmed that officials from the Enforcement Directorate (ED) had visited certain offices of the company and its subsidiary. This move comes following media reports regarding a Foreign Exchange Management Act (FEMA) investigation.

According to a filing made to the stock exchanges, Vedanta stated that the Enforcement Directorate team visited some offices of the company and Hindustan Zinc, a subsidiary of the company. The company also assured that it is extending full cooperation to the authorities and furnishing all information sought during the process.

The disclosure follows reports published on Tuesday that cited officials as saying that the ED had carried out searches at locations associated with the Vedanta Group in Delhi and Mumbai as part of an ongoing FEMA-related investigation. Vedanta further informed investors that the proceedings remain in progress.

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In a separate exchange filing issued on Tuesday, the company reiterated its commitment to regulatory compliance and timely disclosures. The company stated that it will continue to comply with SEBI Listing Regulations and keep the stock exchange(s) duly informed of all material information / events, including price sensitive information(s), in accordance with the applicable provisions.

The development comes after Vedanta chairman Anil Agarwal made a social media post in late March, stating that the company had received written confirmation of winning the bid for a Jaypee Group asset. However, he claimed that the decision was later overturned in favour of another bidder, widely seen as the Adani Group, though he did not explicitly name the conglomerate. Subsequently, Vedanta approached the Supreme Court seeking a stay on the resolution plan submitted by the Adani Group for the Jaypee Group assets.

Vedanta Share Performance

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Vedanta shares have declined 1% to their day's low of ₹330.00 per share on BSE, while Hindustan Zinc also lost 1% to its intra-day low of ₹618.95 per share. Vedanta shares have lost 6% in one week but risen around 23% in one month. Hindustan Zinc shares, on the other hand, have fallen around 4% in one week but added 5% in one month.

Vedanta Demerger

Under the demerger scheme, Vedanta will be split into five distinct entities: Vedanta Aluminium, Vedanta Oil & Gas, Vedanta Power, Vedanta Iron and Steel, and the parent entity, which will continue to operate as Vedanta Ltd. Each of these verticals will be independently listed, allowing investors to gain direct exposure to specific business segments. The share entitlement ratio for the demerger has been set at 1:1, marking one of the biggest corporate restructurings in India’s metals and mining sector. Investors are now awaiting the listing of the four new companies that spun out of the mining conglomerate.