Vedanta's Four-Company Split on Track for August Listing, One Entity to Become World's Largest Metals Firm

Vedanta Group to List Four Demerged Entities Independently

Vedanta Group chairman Anil Agarwal has confirmed that all four demerged entities of the Vedanta Group will be listed independently within the next month. In an exclusive interview with CNBC-TV18, Agarwal outlined the group's plans for the demerged companies, which include Vedanta Aluminium, the oil and gas business, a power company, and an iron and steel company.

Demerged Entities

The demerger creates four separately listed companies. The first is Vedanta Aluminium, which currently produces 30 lakh tonnes annually and is targeting 60 lakh tonnes within three years. This would make it the world's largest aluminium company in the private sector. The group also plans to develop 1,000 downstream industries alongside the aluminium business through an industrial park model.

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The second demerged entity is the oil and gas business, which Agarwal described as his 'heart and soul.' The group plans to invest $5 billion over three to five years to reach production of 500,000 barrels per day. Vedanta's hydrocarbon assets include tight oil, shale gas, shallow water, deep water, and a block in northeast India where, Agarwal said, the country's first oil was produced.

The third demerged entity is a power company currently generating 4,000 megawatts, with a target of 20,000 megawatts, all through brownfield expansion. Agarwal said the company has full coal linkages and described coal as an enduring energy source. The fourth demerged entity is an iron and steel company, which currently produces four million tonnes, three million tonnes at its main plant and one million tonne in Goa, with a target of 15 million tonnes of green, electrical, or special steel.

Residual Vedanta Limited

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The residual Vedanta Limited will retain the zinc and critical metals businesses, including a 65% stake in Hindustan Zinc and the Gamsberg zinc operation in South Africa, which Agarwal described as Africa's largest zinc company.

Investment Plans and Earnings

Agarwal said the group plans to invest $20 billion across these businesses, funded primarily through internal accruals. He put the group's EBITDA at approximately $10 billion.

Policy Recommendations

Agarwal called for longer mining lease tenures, arguing that the current 50-year cap discourages large capital investment. He also called for a single unified policy for all below-ground resources, replacing the current separate frameworks for oil and minerals.

On public sector companies, Agarwal called for broad privatisation. He cited the privatisation of airports and the telecom sector as examples of private operators delivering results.

Import Substitution and Commodities Outlook

Agarwal said India imports roughly $400 billion worth of below-ground resources annually and argued that domestic production could reduce this. Asked which commodity he is most bullish on over the next decade, Agarwal named aluminium, copper, and oil and gas. He also said India has the potential to become a large producer of arms and ammunition if its existing industrial base is modernised and privatised.