Vedanta Ltd on Tuesday received approval from the National Company Law Tribunal to proceed with the proposed demerger of its operations into five separately listed entities, marking a key milestone in billionaire Anil Agarwal’s two-year effort to unlock value at the resources major.
The approval clears the most significant regulatory hurdle for the restructuring, which has faced repeated delays, and sets the stage for Vedanta to complete the exercise by March 2026, one year later than its original guidance.
Vedanta shares rose after the NCLT order and closed 3.5% higher at ₹569.35 on the BSE on Tuesday. The stock jumped another 2% on today to hit a fresh all-time high of ₹580.45 per share.
Mint breaks down what happens next.
What did the order say?
The National Company Law Tribunal cleared Vedanta Ltd’s plan to split its India operations into five separate companies. The ministry of petroleum and natural gas had objected to the demerger plan, claiming Vedanta had misrepresented its oil and gas assets and had not fully disclosed its liabilities.
The tribunal rejected these objections and approved the demerger, ruling that the plan is fair, lawful and not against public interest, and that all legal requirements have been met.
The NCLT also dismissed the government’s charge of non-disclosure, agreeing with Vedanta that it had shared all necessary information and had received approval from more than 99.9% of its shareholders and creditors. The order brings to an end a series of delays to the proposed demerger caused by pending tribunal approval.
Vedanta has now guided for completing the restructuring by March 2026.
What happens next, and what is the likely timeline?
Analysts believe the mining conglomerate must now inform and seek approval from the stock exchanges.
Vedanta has to set a record date, on which all existing shareholders will be eligible to receive shares in the new entities, said Suman Kumar, assistant vice-president for metals and mining at brokerage Philip Capital.
Following this, shareholders will be allotted one share of each of the five demerged companies for every share of Vedanta Ltd, and these companies will be listed on the stock exchanges to trade independently, he said.
While the revised timeline for completion is March 2026, Amit Lahoti, lead analyst for metals and mining at Emkay Institutional Equities, estimates that the demerger should not take more than one to two months beyond this deadline, if not completed within it.
Which will be the new companies, and how will Vedanta’s debt be split?
The five proposed businesses are:
Vedanta Ltd: The flagship company, which will hold shares of subsidiary Hindustan Zinc, Sterlite Copper, as well as international businesses such as Zinc International and Konkola Copper Mines.
Vedanta Aluminium: This entity will house the company’s aluminium business, including refining operations. It is the largest producer of the metal in the country.
Vedanta Oil & Gas: The business of Cairn India, a leading oil and gas exploration and production company with key assets in Rajasthan, will be housed under this company.
Vedanta Iron and Steel: This company will include the steel business under ESL Limited as well as the company’s iron ore mines.
Vedanta Power: Vedanta’s merchant power business, including the Talwandi Sabo power plant in Punjab, will be part of this entity.
A key monitorable for shareholders will be how Vedanta apportions its debt of approximately ₹66,000 crore across the five new companies, as this will determine the health of their respective balance sheets.
Lahoti from Emkay estimates that the bulk of the debt, about ₹30,000 crore, will go to the aluminium business, as it generates the most cash among the group’s businesses. The second-largest share, about ₹20,000 crore, is expected to sit with the flagship Vedanta Ltd, given its dividend receipts from Hindustan Zinc. Iron and Steel ( ₹4,500 crore), Oil & Gas ( ₹4,000 crore) and Power ( ₹7,000 crore) are expected to absorb the remaining debt, according to Lahoti’s estimates.
Why is Vedanta pursuing a demerger?
When announcing the demerger in 2023, the Anil Agarwal-led Vedanta had said it aimed to unlock value by simplifying its corporate structure and creating sector-focused independent businesses. The move would allow investors to directly invest in each pure-play company rather than through a diversified conglomerate structure.
“By demerging our business units, we believe that will unlock value and potential for faster growth in each vertical,” Agarwal had said in a statement at the time.
What do analysts say, and how should investors read the move?
Philip Capital’s Kumar views the NCLT order as an incremental development rather than a transformational milestone.
There is no significant reward from the restructuring or remodelling, and the exercise is mainly aimed at monetizing some non-core assets or bringing international companies into pure-play businesses through a joint venture or equity investment route, he said.