Vedanta shares fall 2% post its fourth dividend announcement; Citi bullish on the largecap stock

Shares of the diversified metals company Vedanta traded in the red after a positive opening. At around 1 pm, shares were weak by 0.95 per cent or Rs 4.9 at Rs 508.5 per share on the BSE. At the day's high, the stock scaled levels of Rs 515.35, while it marked the day's low of Rs 504.

On Monday, the company declared its fourth interim dividend for the FY2024-25 amounting to Rs 8.5 per share. Anil Agarwal-led company will spend as much as Rs 3,324 crore on the dividend payment.

The record date for the purpose of payment of dividend shall be Tuesday, December 24, 2024, and the interim dividend shall be duly paid within the stipulated timelines as prescribed under law, added the company's filing with the exchanges.

As per the Trendlyne data, the company since 2001 has declared a total of 46 dividends. In the past 12 months, Vedanta has declared an equity dividend amounting to Rs 46.00 per share. At the current share price of Rs 506.8500, Vedanta's dividend yield is 9.08 per cent.

Earlier before, the company's third dividend amounted to Rs 20 per share. 

Brokerage's view on Vedanta

Global brokerage Citi has maintained its buy call on the scrip for a target of Rs 485. However, the set target implies a potential downside of over 5 per cent. The brokerage acknowledged that the company's total outflow on account of dividend payment will amount to approximately Rs 3,300 crore.

It added that thus far in the fiscal year the company's total dividend amounted to Rs 43.5 per share or around Rs 16,800 crore.

Furthermore, it added that the dividend received from Hindustan Zinc (HZL) so far in the current fiscal year is around Rs 7,800 crore. Vedanta is the parent company of HZL and owns as much as 63.4 per cent stake.

Vedanta share price performance

On a year-to-date basis, the stock has gained 95 per cent, while its 1-year return is at 96 per cent.

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