Vedanta Share Price: 2950% Dividend, Multibagger Mining Stock Rises For 5th Day; Over 100% Gains In 2024

The shares of Vedanta Limited, one of India's leading mining giants, continued their rally on Friday, marking gains for the fifth consecutive trading session. The stock surged by an additional 3% to hit a fresh all-time high of Rs 515.90 per share.

The recent rally in Vedanta's stock can be largely attributed to the economic measures taken by China, the world's largest consumer of base metals. China's government implemented policy interventions, including a cut in the reverse repo rate, as part of efforts to boost its economy to reach its targeted growth rate of around 5% for the year. This move has had a direct positive impact on the global metal market, pushing up the prices of key industrial metals like aluminum, copper, and nickel.

Furthermore, aggressive rate cuts by the US Federal Reserve have also played a pivotal role in creating a favorable market environment for metal companies, including Vedanta. These factors have helped Vedanta benefit from the overall rise in metal prices.

China accounts for approximately 50% of the world's output of base metals, making it the most significant player in the global metal market. Any revival in China's domestic demand inevitably has a profound impact on the base metals market. This ripple effect, in turn, boosted Vedanta's share prices, as higher metal prices translate into better margins and increased profitability for the company.

Vedanta's stock has seen an astounding 100% gain so far in 2024, marking a complete turnaround from the past two years, which were marked by weak performance.

Adding to the positive momentum, Vedanta announced that its board will meet on October 8 to consider and approve the fourth interim dividend for the financial year 2024-25. The record date for determining the entitlement of equity shareholders for this fourth dividend, if declared, is set for October 16, 2024, as per the company's filing with the exchange. So far, Vedanta has approved a total dividend payout of Rs 13,474 crore for the fiscal year 2024-25.

Vedanta has unveiled growth plans, with a capital expenditure (capex) program of around $8 billion over the next few years. This investment is aimed at expanding operations across multiple sectors.

Vedanta aims to ramp up oil and gas production to 300,000 barrels per day. The company's iron ore operations in Liberia are expected to yield around 30 million tonnes per year (mtpa). The Bharat Aluminium Company Limited (BALCO) expansion project is expected to be commissioned in the fourth quarter of FY25, with operations slated to begin in the first quarter of FY26.

The Radhikapur coal block has secured environmental and stage 1 forest clearances, with operations likely to commence by the fourth quarter of FY25. Meanwhile, the Kurloi coal mine block is progressing well, and the Ghograpalli mine is expected to be fully operational by FY26.

Vedanta has commenced the utilization of renewable energy from its RE-RTC (Renewable Energy Round-the-Clock) projects. Its subsidiary, Hindustan Zinc, achieved an 8.5% share of renewable power in the first quarter of FY25.

Vedanta has set a goal to deliver $10 billion in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) in the near term. The company plans to achieve this by leveraging its diverse revenue streams across different segments like aluminum business, which is expected to contribute $4 billion, Zinc India, which is anticipated to generate around $2.7 billion. Oil and Gas segment is targeting a contribution of $1 billion, and other segments like Vedanta's iron ore, steel, power, and other business operations will contribute to the remaining amount.

As of 12:05 pm on Friday, Vedanta's shares were trading at Rs 507.45 per share on the National Stock Exchange (NSE), marking a gain of more than 1% for the day. The stock has delivered multibagger returns of over 140% in the last year.