Metals & Mining News

Vedanta Board meeting: Vedanta board to meet on September 21 to consider bond issue


Vedanta Ltd board will meet on September 21 to consider raising non-convertible debentures, the company informed the stock exchange without giving any additional details.

The company has two separate term loans of Rs 300 crore and Rs 1000 crore due on November 14, 2023 and on March 31, 2024 respectively. The fresh issues of bonds would be to meet the capex requirements or repay these terms loans.

Vedanta Ltd has received AA- rating for a proposed Rs 1555 crore NCD from Crisil Ratings.

India listed metal to mining conglomerate has rated terms loans of Rs 26,186 crore, non-fund based facilities of Rs 24,155 crore and fund-based facilities of Rs 5940 crore, according to a rating report by Crisil dated April 26, 2023. The term loan and fund-based facilities are rated as AA- while the non-fund based facilities have A1+ ratings.
The proposed fundraise comes at a time when Anil Agarwal’s Vedanta Resources – the holding company of Vedanta Ltd – is working round the clock on the redemption of the upcoming USD 3.2bn offshore bonds. Vedanta Resources has $1 billion 13.875% bonds due in January 2024, $1bn 6.125% bonds due in August 2024 and $1.2bn 8.95% bonds due in March 2025.At a bondholders meeting organized by Standard Chartered Bank and JP Morgan between September 11 and 15 at Singapore and Hongkong, it proposed extending the tenure of the bonds by three years, as reported by ET on September 12. S&P Global Ratings had revised Vedanta Resources’ outlook in August to negative, raising concerns over the company’s ability to refinance its upcoming liabilities. Last week, it warned of a possible downgrade of the offshore bonds if it fails to compensate the bondholders adequately.

In a separate report, Kotak Securities said Vedanta Resources has ‘largely addressed’ the funding gap of FY2024 through various one-time measures, including a stake sale in Vedanta Ltd. However, the $2.2 bn bonds maturing in FY2025 is a ‘taller hump’ Kotak said in its report. The “large dividends are no longer possible, and Vedanta Resources might be forced to further divest stake or its assets in (India listed) Vedanta Ltd. The bleak commodity cycle suggests a downside risk to earnings,” the report added, recommending a sell.


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