Vedanta Resources Repaid 800 Million Worth Of Its Loan, Claims To Go Debt Free

Anil Agarwal’s Vedanta Resources is an Indian-based mining and metal company with operations worldwide. It is one of the leading producers of iron ore, copper, and zinc, majorly through acquisitions in multiple countries. 

According to reports, Vedanta Resources has recently repaid loans worth $800 million which includes $600 million borrowed from Indian Banks and remaining funds raised through the public issue of bonds.

Vedanta Resources repaid loans of 800 million dollars

The repayment is gaining a lot of attention as it is showing a negative impact on liquidity after the surging rate intensifies. besides that, it has been said this could be a heavy depth for the low-rated borrowers with heavy debt loads as well.

The London-based firm confirmed that they have repaid three facilities, taken from Standard Chartered Bank in London and Hong Kong. at an exchange filing. The repayments released the burden created on the shares of its unit Vedanta Ltd, they said.

Besides that, it is important to note how the repayment was made despite the financial crises of the current state of the economy.

Vedanta Resources is relying on sizable dividends from its Indian subsidiaries, which are known to reach record levels in their most recent fiscal year, to pay its short-term obligations. 

The market is paying close attention to the firm as its ability to service its dollar notes due this month and an even larger debt load due in 2024 when over $2 billion in bonds are set to mature. 

Vedanta resources owner claims to go ‘debt free’

Mining magnate Anil Agarwal stated last month in an interview that his Vedanta firm has enough cash flow to meet all of its debt repayment obligations and that it intends to become a “net zero debt company” in two to three years.

To further lower its gross debt by $1 billion, Vedanta Resources Ltd, the parent company of mining behemoth Vedanta Ltd, which is listed on the Mumbai Stock Exchange, said in April that the firm has paid all of its maturing loans and bonds due this month.

Anil Agarwal claims that they will have no depth at all in little more than two to three years. However, India has a lot of work to do. The production of semiconductors (factory), display glass (factory), aluminum (business), copper (business), and oil and gas operations (operations) all need to be expanded; these are all crucial. Then, they could have to take on debt, but as of now, they have no plan, says Anil Agarwal.

Currently, the firm has reported that they have paid all of their maturing loans and bonds that were due in April 2023, followed by last month’s repayment .now the Vedanta’s gross depth stood at 6.8 billion, down from 7.8 billion at the end of the march.

Anil Agarwal states that the corporation owes a total of $13 billion in debt. Additionally, we made $7 billion in profit this year. The group’s revenue would be $30 billion the next year, and we would make $9 billion in profit.

S&P Global Ratings had mentioned in February that the company could meet its obligations until September. Liquidity beyond that would depend on critical fundraising and the proposed sale of international zinc assets by Vedanta Ltd to Hindustan Zinc.

However, according to recent reports, Hindustan Zinc’s proposal to buy zinc assets from Vedanta worth $2.98 billion in cash is currently on hold as the company did not receive its shareholders’ approval within the given time limit.

It was previously reported that Hindustan Zinc is less likely to pursue the plan of purchasing Vedanta Resources’ global zinc business because the government was not eager on the offer.

In the coming years, it is important to note how the company is going to repay all of its debt and go debt free and also how it is going to impact the low-rated borrowers with heavy depths.

Proofread & Published By Naveenika Chauhan