Vedanta shares trades higher for 5th straight day, rallies 8%; upside left?

Analysts remain positive on Vedanta given the robust non-ferrous prices, strategic expansion at aluminium and zinc India, controlled leverage on B/S, return ratios >20%, dividend yield of 6%.

Vedanta share price today

 

Vedanta stock continued its upward march, hitting a new high of ₹551.45 and gaining 1.5 per cent on the BSE in Monday’s intra-day trade. The stock price of the metal company was quoting higher for the fifth straight day, surging 8 per cent during the period. In comparison, the BSE Sensex was up 1 per cent.

 

Thus far in the calendar year 2025, Vedanta has outperformed the market by soaring 24 per cent. In comparison, the BSE Sensex and the BSE Metal index were up 8.5 per cent and 21 per cent, respectively.

 

Why has Vedanta share price outperformed in the past one week?

 

Vedanta, a subsidiary of Vedanta Resources, is diversified natural resources conglomerate with presence across aluminium, zinc lead-silver, oil and gas, power, iron ore, steel, ferroalloys, and copper. Operating India’s largest primary aluminum metal capacity ~2.8 MTPA. Also enjoys a leadership position in zinc and lead domains with mined metal capacity of ~1.2 MTPA, and the 4th largest silver producer globally.

 

 

Vedanta on December 11 announced that the company was declared as Successful Bidder in respect of Genjana Nickel, Chromium and PGE Block after fulfilling required statutory compliances via letter dated December 10, 2025. This receipt of Successful Bidder for Genjana Nickel, Chromium and PGE Block under Critical Mineral Auctions Tranche III shall further strengthen the company’s critical minerals portfolio, Vedanta said.

 

Meanwhile, as per media reports, China has announced restrictions on silver exports from 2026, requiring companies to obtain export licences, with the policy remaining in force through 2027. Meanwhile, spot silver prices declined 3 per cent to $61.7/ounce on December 13, 2025.

 

The recent decline in spot silver prices is viewed as short-term, driven by profit-booking. However, silver prices are likely to remain elevated amid China’s export restrictions, given it is the world's second largest silver miner with 50 per cent to 60 per cent of output supplied to the global market. 

 

This development is positive for Hindustan Zinc, India’s largest silver producer, with a refining capacity of ~800 tonnes per annum as of FY25, where silver contributed 40 per cent of earnings before interest tax (EBIT) in FY25. As silver is a by-product with minimal processing cost, higher prices directly aid profitability. However, considering rich valuations at Hindustan Zinc, ICICI Securities said it prefers exposure through its promoter entity, Vedanta.

 

Brokerages see more upside in Vedanta stock price

 

Vedanta has generated strong cash flows (CFO >₹30,000 crore since FY22), enabling deleveraging, with Net Debt/EBITDA improving to 1.37x as of Sep’25 and targeted at ~1x by FY27, supported by healthy organic growth. Despite historically high dividend payouts, robust FCFF generation is expected to sustain a forward dividend yield of 6 per cent. With well charted growth trajectory at its other verticals namely Zinc India, Power & Steel, etc., analysts at ICICI Securities expect EBITDA at Vedanta to grow at a compound annual growth rate (CAGR) of 25 per cent over FY25-27E.

 

The brokerage firm remains positive on Vedanta given the robust non-ferrous prices, strategic expansion at aluminium and zinc India, controlled leverage on B/S, return ratios >20 per cent, attractive dividend yield of ~6 per cent. Analysts have retained a 'BUY' rating on Vedanta with SOTP based revised target price of ₹650.

 

Vedanta is demerging its business into five separate listed entities (aluminium, power, oil& gas, steel & iron ore and Vedanta, which shall house zinc business, copper, etc), thereby giving investors an opportunity to invest in a commodity of their choice.

 

The demerger is envisioned as a simple vertical split - for every share of Vedanta, a shareholder will additionally receive one share each of the five newly listed companies. One positive is that new ventures shall be clubbed under one company, Vedanta, which removes ambiguity of owning other commodity companies.

 

This will help in unlocking value by improving valuation of companies such as aluminium, steel and power. Analysts at Nuvama Institutional Equities estimate a fair value of ₹686 (ceteris paribus) shall be enhanced by ₹84/share once the demerger comes into effect.