Chandigarh, November 13, 2024: Leading brokerage firms including ICICI Securities, Nuvama, CLSA, and IIFL have reaffirmed their positive outlook on Vedanta Limited, driven by a robust Q2 performance, improved earnings visibility, and favourable cost metrics. Analysts anticipate strong upside potential, pointing to operational efficiencies, on-track debt reduction, and ongoing expansion projects.
Following is a list of top brokerage houses’ recommendations on Vedanta Limited post the Q2 FY25 results:
| Firm Name | Recommendation | Target Price Post-Q1 Results (₹) | Target Price Post-Q2 Results (₹) |
| Nuvama | Buy | 608 | 663 |
| ICICI Securities | Buy | 600 | 600 |
| Emkay Global | Buy | 600 | 600 |
| IIFL | Add | 525 | 559 |
| Systematix | Buy | 497 | 545 |
| Citi | Buy | 425 | 485 |
| CLSA | Outperform | 520 | 520 |
| Motilal Oswal | Neutral | 460 | 520 |
| Investec | Hold | 470 | 510 |
| JP Morgan | Neutral | 410 | 490 |
| BAML | Neutral | 410 | 470 |
*Calculated on CMP of ₹ 456 as of 11 November, 2024
Brokerage house Nuvama maintained its “Buy” recommendation with an upward revision of the target price to ₹663 from ₹608 prior to the quarterly results. Nuvama noted that better-than-expected cost control at Vedanta’s aluminium and zinc operation helped the company to offset weakness in global metal prices. Nuvama’s report highlighted Vedanta’s demerger plan as a potential value driver.
Broking firm ICICI Securities also maintained its “Buy” rating with a target price of ₹600. ICICI Securities emphasized on Vedanta’s cost stability in the aluminium business, where production costs held steady despite alumina price pressures. ICICI’s brokerage report stated, “Debt at VRL is at USD 4.8bn (decadal low-level) as on end-Sep’24, implying reduction of USD 1bn in H1FY25, ahead of stated target. Besides, management expects interest to be serviced by branding fee and principle by up streamed dividend, implying sustained dividend yield of 5-6%.”
Global research firm CLSA reiterated an “Outperform” rating at the target price to ₹520 post-Q2 results, acknowledging Vedanta’s strong EBITDA performance of ₹ 98.3 billion for the second quarter. CLSA emphasized Vedanta’s ongoing debt reduction and added, “Leverage concern now largely behind us. Net debt fell Rs 43bn QoQ helped by a stake sale (in Vedanta and HZL) and working capital release, partly offset by its dividend payout.” Global brokerages Investec, JP Morgan and BAML maintained “neutral” stance on the miner however, they upgraded their target prices to ₹510, ₹490, and ₹470 respectively.
Top brokerage firms project sustained earnings growth for Vedanta through FY26, driven by operational expansions and an attractive dividend yield. With a strong Q2 performance, Vedanta management during the analyst’s call highlighted its expectation of a strong earnings ramp-up in 2H as it believes 1H accounted for 40% of FY EBITDA, in line with historical trends.