New Delhi: Investors’ eyes are now on the shares of Vedanta Ltd. Brokerage firm Nuvama has given a new target price for the shares of the mining giant which is led by Anil Agarwal. On Wednesday, January 14, Nuvama maintained its BUY rating on Vedanta and raised the target price by 18 percent to Rs 806, from Rs 686 earlier. According to the new target, the stock gets an upside of about 27 percent from Tuesday’s closing price. In the last one week, its shares have risen by around.
Nuvama said that Vedanta is in the final stages of its demerger process and the legal clearances required to divide the company into five separate listed units are nearing completion. This is expected to result in huge value unlocking for shareholders. Along with this, strong commodity prices, cost reduction and volume growth are making the company’s investment case stronger.
EBITDA estimate increased, commodity price gains
Considering the high commodity prices, the brokerage has increased the EBITDA estimate of FY27 by 17 percent for Vedanta and 8 percent for FY28. Nuvama says that under these circumstances, Vedanta’s EBITDA may increase at a CAGR of about 20 percent between FY 25 and 28.
According to Nuvama, the full value of Vedanta’s aluminum and zinc business is still not included in the current market price. The brokerage believes that other businesses are getting almost free of cost, which is a big attraction for investors.
Vedanta stock records sharp rise
On January 14, Vedanta’s shares trading with strong momentum. The stock climbed 5.42 percent to Rs 671.75. In the last one week, the stock has come up 9.04 percent. At the same time, it has registered a strong growth of 40.15 percent in the last one quarter and about 62.38 percent in the last one year. The scrip settled at Rs 676 apiece on Wednesday.
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