Vedanta’s share price drop of nearly 65% is primarily attributed to a strategic demerger that took effect on April 30, 2026, rather than a broader market crash, resulting in a significant restructuring of its business model.
As part of this demerger, Vedanta Ltd will separate into five distinct entities: Vedanta Aluminium Metal Ltd, Vedanta Power Ltd, Vedanta Oil & Gas Ltd, and Vedanta Iron and Steel Ltd. The demerger ratio stands at 1:5, meaning that eligible shareholders will receive one share in each new company for every share they hold in Vedanta Ltd.
Prior to the demerger, Vedanta shares were valued at approximately ₹773; however, following the event, the share price adjusted to around ₹290. This adjustment led to a market capitalization of ₹1,08,141.78 crore after the drop.
The new entities are expected to be listed within 4 to 8 weeks from the record date, with expectations for the listing date around June to July 2026. Analysts have noted that this move aims to unlock value by separating different business segments.
According to analysts at ICICI Direct, the revised sum of the parts (SoTP) valuation for all resulting entities combined is estimated at ₹820 per share. This suggests that while the immediate reaction may appear negative, the long-term outlook could be more favorable as investors assess the individual value of each segment.
In light of these developments, observers have pointed out that among the newly formed companies, Vedanta Aluminium is perceived as particularly attractive. This sentiment reflects broader expectations that the segmentation will allow for more focused management and operational efficiencies.
Investors should closely monitor how the combined value of both Vedanta Ltd and its new entities evolves post-demerger. The situation remains fluid as market reactions continue to unfold.
