Vedanta sets QIP floor price at ₹461.26 per equity share; check details here

Mining giant Vedanta has announced a floor price of ₹461.26 per equity share for its Qualified Institutional Placement (QIP) issue, according to an exchange filing on July 15.

"We further wish to inform you that the ‘relevant date’ for the purpose of the Issue is July 15, 2024, and accordingly, the floor price in respect of the aforesaid Issue is ₹ 461.26 per equity share," the company said in an exchange filing on Monday.

Shareholders of Vedanta approved the issuance of securities to raise up to ₹8,500 crore on June 21. This strategic initiative is aimed at optimizing Vedanta's capital structure and increasing shareholder value, underscoring the company's dedication to financial growth and stability.

QIP, or Qualified Institutional Placement, is a strategy employed by publicly traded companies in India to swiftly raise funds. This involves issuing shares or convertible securities exclusively to a targeted group of institutional investors, including mutual funds, venture capital firms, insurance companies, and foreign institutional investors.

In May, the company announced its plans to raise up to ₹8,500 crore to decrease its debt load, a plan that was approved by shareholders last month.

Vedanta is currently engaged in multiple growth projects and is focusing on long-term capital expenditures totaling around $8 billion.

For the current fiscal year, its capital expenditure target is expected to reach $1.9 billion, reflecting an increase of more than a third compared to the $1.4 billion spent last year.

Vedanta reported a 27 per cent decrease in net profit for the fourth quarter of the fiscal year 2023-24, influenced by lower prices of metals such as zinc, copper, and aluminium, alongside subdued performance in the oil and gas segment.

As of March 2024, the reported a consolidated net debt of ₹56,338 crore with a net-debt to operating profit ratio of 1.5 times. The company's gross debt amounted to ₹71,759 crore, of which 82 per cent is denominated in Indian rupees and the remainder in foreign currency.