This metal company shares rise nearly 2%; CLSA sees over 16% potential upside

Shares of the diversified metals company gained nearly 2 per cent in Tuesday’s session to day’s high price of Rs 454.55 apiece on the BSE. The gains in the stock are spurred after the company in an exchange filing informed about its upcoming meeting of its duly constituted Committee of Directors on Thursday, June 20, 2024

“we would like to inform you that the Company proposes to hold a meeting of its duly constituted Committee of Directors on Thursday, June 20, 2024 to consider the proposal for issuance of Non-Convertible Debentures on a private placement basis as part of its routine financing / refinancing that is undertaken in ordinary course of business,” said the company’s filing with the exchanges.

The above issuance is pursuant to the Board of Directors’ resolution passed at its meeting held on March 21, 2024, added the filing.

Earlier in its filing last week, the company announced that Cairn Oil & Gas - part of the Vedanta Group has implemented ASP flooding in the Mangala oil field in Barmer, Rajasthan, marking the largest commercial injection implemented in any oil and gas field in India, and amongst the very few done globally. 

What should investors do with Vedanta?

CLSA maintained buy on the stock with a raised target of Rs 520 from the earlier Rs 430. The focus is on operational improvements. Aluminium will be a key value driver through capacity additions, cost control, and a change in mix.

Improved earnings from Zinc and Crude oil are likely to be gradual and will be closely watched, it added.

Further, it sees several operational catalysts for sustained outperformance of the stock.