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New Delhi, Billionaire Anil Agarwal's <keyword id="28423" type="General" weightage="20" keywordseo="vedanta" source="Orion">Vedanta</keyword> Resources Ltd has debt servicing obligations of about USD 3 billion, including interest, in the current fiscal, S&amp;P Global Ratings said on Monday, estimating that the natural resources company will likely have enough liquidity until December 2023. In a statement, S&amp;P said Vedanta is close to securing about USD 1 billion of funding at one of its operating companies. "The India-based natural resource company has debt servicing obligations of about USD 3 billion, including interest and inter company loans," it said. "It will have at least another USD 1 billion obligations that require funding until March 2024." Vedanta Resources is the parent company of Mumbai-listed Vedanta Ltd that declared a fifth interim dividend for 2022-23 fiscal last month. "The rating on Vedanta Resources reflects our expectation that it will secure additional funds to support liquidity beyond December 2023," S&amp;P said. "The company is discussing with banks and investors on multiple funding options for at least another USD 2 billion." Successful closure of some of these discussions will facilitate the payment of its USD 1 billion bond due January 2024. "Failure to demonstrate a credible refinancing plan at least six months before the bond maturity could lead to downside rating pressure," it said, adding it did not believe that Vedanta Resources will not undertake any transaction that would be regarded as distressed. Vedanta Resources' funding initiatives are also supported by its capacity to borrow at its subsidiary, Twin Star Holdings Ltd. The latter directly owns a 46 per cent stake in the operating company, Vedanta Ltd. "Vedanta Resources has been more successful in the past in raising debt at the Twin Star level, given the structural seniority of Twin Star debt to Vedanta Resources debt. "We estimate Twin Star has the capacity to raise about USD 500 million under its debt covenants," the rating agency said. Vedanta Resources' USD 1 billion bond maturing in January is also part of the debt at Twin Star. Its USD 400 million bank loan maturing during the year are also part of the debt at intermediate holding companies, Twin Star, and Vedanta Netherlands Investments B.V. "While the recent fund-raising is credit-positive, Vedanta Resources will become more dependent on external funding. This is due to declining cash at the company's operating subsidiaries, which has historically been a source of credit strength," it said. S&amp;P estimated that Vedanta Ltd had consolidated cash of about USD 2.5 billion as of March 31, 2023, down from about USD 4 billion as of March 31, 2022. The company will use USD 930 million of this to pay dividends in April. However, external funding risk has increased due to challenging market conditions. "Although Vedanta Resources has a track record of raising funds in stressed market conditions and is willing to raise expensive debt to refinance, constant refinancing risk continues to hold back the company's credit profile," S&amp;P said. "Vedanta Resources Ltd. will likely have enough liquidity until December 2023," it added.

Vedanta has $3 billion debt servicing obligations this fiscal: S&P

<keyword id="6355267" type="General" weightage="20" keywordseo="mining" source="Orion">Mining</keyword> mogul <keyword id="6354819" type="General" weightage="20" keywordseo="anil-agarwal" source="Orion">Anil Agarwal</keyword> has said his <keyword id="28423" type="General" weightage="20" keywordseo="vedanta" source="Orion">Vedanta</keyword> group has ample cash flow to service all its <keyword id="44647" type="General" weightage="20" keywordseo="debt" source="Orion">debt</keyword> repayment obligations and that it aims to become a "net <keyword id="817349" type="General" weightage="20" keywordseo="zero-debt" source="Orion">zero debt</keyword> company" in 2-3 years. Agarwal said questions over Vedanta's debt servicing ability are "absolutely irrelevant" as the group will make USD 9 billion of profits next year on revenue of USD 30 billion, which would be sufficient to meet all obligations. The comments by the former scrap metal trader turned industrialist come at a time when scrutiny of highly leveraged Indian conglomerates grows following a US short seller attack on the Adani group. "We have the lowest debt in the world for a group of our size," Agarwal, founder, and chairman of Vedanta Resources, told PTI in an interview here. And the debt is a result of investing billions of dollars across businesses, he said. "Total debt in the company is USD 13 billion. And we have a profit this year of USD 7 billion. Next year our revenue would be USD 30 billion and we will have USD 9 billion profit" across the group. The cash flows are more than sufficient to meet debt servicing obligations. "We are very comfortable," he said. "We have never defaulted to make any payment. We always have a plan to make the payments." Earlier this week, Vedanta Resources Ltd, the parent company of Mumbai-listed mining giant Vedanta Ltd, said it has paid all its maturing loans and bonds due this month to reduce its gross debt by a further USD 1 billion. Vedanta has now reduced debt by a total of USD 3 billion since it announced in February 2022 its intention to accelerate deleveraging. It had announced plans to reduce debt by USD 4 billion within 3 years, of which it has achieved 75 per cent of the committed reduction in 14 months. Agarwal said it is "absolutely irrelevant" to talk about the debt payment capability of the group. The group, whose business spans from zinc to silver, iron ore to aluminium and oil and gas, borrows the bare minimum, and "we have enough cash flow to service that debt," he said. He went on to state that the group would be a net zero debt company in 2-3 years' time. "At the moment the plan is that in 2-3 years we will be a net zero debt company," he said hastening to add that the group may have to borrow in pursuit of its aggressive expansion plans. Diversified natural resources conglomerate plans building capacities in zinc, oil and gas, and aluminium businesses as it believes supply will remain a challenge in the commodities' space in the medium term. The group, which has already invested USD 35 billion in the country so far, plans to become a USD 100-billion company by 2030. Vedanta is also foraying into the manufacturing of semiconductor and display fabs and signed an initial pact with Apple supplier Foxconn to set up a manufacturing facility in Gujarat. India is 100 per cent import-dependent for fabs and semiconductors with domestic consumption expected to cross USD 80 billion by 2026 and touch USD 110 billion by 2030. "Yes 100 per cent within a maximum of 2-3 years time, we will be zero debt company. But we have to do a lot in India. We have to create semiconductors (factory), we have to create display glass (factory), we have to expand our copper (business), we have to expand our aluminium (business), we have to expand oil and gas (operations), this is important. At that point, we might have to take debt (but) we have no plan (as of now)," he said. S&amp;P Ratings on April 3 stated that Vedanta will likely have enough liquidity until December. US short-seller Hindenburg Research's damning report on billionaire tycoon Gautam Adani's infrastructure conglomerate this year triggered a stock market routing that had erased about USD 145 billion in his group's market value at its lowest point. Adani group has denied all allegations by Hindenburg and is plotting a comeback strategy. Agarwal dismissed concerns about paying upcoming liabilities, stressing his commodities businesses were generating enough cash to service debt. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/best-discounts-offers-and-deals-on-smartphones-laptops-and-electronics-items-in-amazon-sale-2023/articleshow/99815311.cms">Amazon Sale 2023: Bank discounts, offers, and deals on gadgets and more teased</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/how-to-grant-social-benefits-to-same-sex-couples-sc-asks-centre/articleshow/99815407.cms">'How to grant social benefits to same-sex couples', SC asks Centre</a>

Anil Agarwal makes 'zero debt' pledge, says 'very comfortable' servicing debt

Billionaire Anil Agarwal's <keyword id="2040264" type="General" weightage="50" keywordseo="vedanta-resources-ltd" source="Orion">Vedanta Resources Ltd</keyword> on Wednesday said it has slashed debt by USD 2 billion in the current fiscal as it looked to soothe investor concerns over ability to repay upcoming obligations. The company, which is the parent firm of Mumbai-listed <keyword id="2735606" type="General" weightage="50" keywordseo="vedanta-ltd" source="Orion">Vedanta Ltd</keyword>, had a net debt of USD 9.66 billion as of March 31, 2022, according to an investor presentation on its website. After repayments and borrowings, it has about USD 7.7 billion outstanding, of which USD 3 billion is due for repayment in the fiscal year starting April 2023. In a statement, the company said it has "deleveraged by USD 2 billion in the past 11 months, thus achieving half of its USD 4 billion 3-year debt reduction commitment in the first year alone." Last week, S&amp;P Global Ratings had stated that the company's credit ratings may "come under pressure" if it is unable to raise USD 2 billion and/or sell its international zinc assets. "Powered by robust domestic consumption in the fastest growing major economy, <keyword id="28423" type="General" weightage="100" keywordseo="vedanta" source="Orion">Vedanta</keyword> is delivering healthy cash flows whilst maintaining disciplined capital allocation and has reduced net debt by USD 2 billion, ahead of plans for this fiscal. "During 2023-24 (FY24) and 2024-25 (FY25), Vedanta will continue to deleverage from net debt of USD 7.7 billion and plans to cover 50 per cent of FY24 liquidity requirements internally and the balance through refinancing," the Vedanta statement said. Vedanta Ltd (Vedanta Resources has 70 per cent stake) has proposed sale of the international zinc business to Hindustan Zinc Ltd (Vedanta Ltd has 65 per cent ownership) for nearly USD 3 billion. The government reportedly is averse to the deal. Valuation of the assets is among several concerns flagged by the government, which holds a 29.54 per cent stake in HZL, which was privatised more than two decades ago. S&amp;P had last week stated that Vedanta Resources is fully funded until March 2023, following a dividend declared by Vedanta Ltd in January. "We estimate further dividends from Vedanta Ltd, together with management fees, can be used to meet about USD 1.5 billion of the USD 2 billion the parent requires between April and June, including inter-company loans and interest expenses," it had said. Debt maturities next fiscal include USD 500 million of loan repayments in the quarter ending December 31, 2023 and a USD 1 billion bond in January 2024. "Over the past 20 years, Vedanta has raised more than USD 35 billion through debt and equity and yielded highly attractive returns to shareholders, while maintaining an excellent track record of debt servicing," the Vedanta statement said. Vedanta has a portfolio comprising zinc (world's largest integrated producer), aluminium (<keyword id="3658" type="General" weightage="50" keywordseo="india" source="Orion">India</keyword>'s largest producer of primary aluminium), oil and gas (India's largest private producer of crude oil), silver (6th largest producer globally), battery metals: Nickel (India's sole nickel producer) and cobalt, copper, iron ore and steel and commercial energy. "Vedanta's next phase of growth will be fueled by its associated companies' investments into semiconductors (India's first semiconductor producer in collaboration with Foxconn), display glass (Avanstrate), renewables (through joint venture with KKR), optical fibre (fibre to home) and transmissions (half of India's power transmission)," the statement said. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/news/adani-enterprises-posts-820-crore-net-profit-in-q3-gautam-adani-says-current-market-volatility-temporary/articleshow/97914997.cms">Adani Enterprises posts ₹820 crore net profit in Q3: Gautam Adani says current market volatility temporary</a> <a href="https://www.businessinsider.in/business/telecom/news/vodafone-idea-q3-net-loss-widens-to-7990-crore-average-revenue-per-user-edges-up-to-135/articleshow/97939836.cms">Vodafone Idea Q3 net loss widens to ₹7,990 crore, average revenue per user edges up to ₹135</a> <a href="https://www.businessinsider.in/business/corporates/news/nykaas-stock-plunges-4-2-after-its-q3-net-profit-slips-70/articleshow/97901748.cms">Nykaa’s stock plunges 4.2% after its Q3 net profit slips 70%</a>

Vedanta cuts debt by $2 billion ahead of target to soothe investor concerns

<ul><li>Indian benchmark indices <keyword id="6484188" type="General" weightage="80" keywordseo="sensex" source="Orion">Sensex</keyword> and <keyword id="2931774" type="General" weightage="20" keywordseo="nifty50" source="Orion">Nifty50</keyword> edged lower in morning trade on Friday amid negative cues in global markets. </li><li>Realty, metal and auto stocks declined while FMCG and media stocks edged up. </li><li>Both the benchmark indices were down 0.1%, with Sensex at 59,579 points and Nifty50 at 17,596 points.</li></ul>Indian benchmark indices Sensex and Nifty50 edged lower in morning trade on Friday amid negative cues in global markets. Realty, metal and auto stocks declined while FMCG and media stocks edged up. Both the benchmark indices were down 0.1%, with Sensex at 59,579 points and Nifty50 at 17,596 points. Top gainers and losers on Nifty50 <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top gainers </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top losers </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HCL Tech </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.69% </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tech Mahindra </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.92% </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Apollo Hospitals </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.96% </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tata Steel </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.76% </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Divi's Laboratories </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.91% </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hindalco Industries </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.51% </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Cipla </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.86% </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">JSW Steel </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.33% </td></tr><tr><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BPCL </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.86% </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Adani Enterprises </td><td style="border-left:solid #000000 0.6000000000000001pt;border-right:solid #000000 0.6000000000000001pt;border-bottom:solid #000000 0.6000000000000001pt;border-top:solid #000000 0.6000000000000001pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.19% </td></tr></tbody></table> Source: NSE, as on April 21, 2023 Earlier on Thursday, markets snapped a three-day losing streak to close in the green, with Sensex gaining 0.11% and Nifty50 gaining 0.3%. <keyword id="141968" type="General" weightage="80" keywordseo="hcl-tech" source="Orion">HCL Tech</keyword> delivered its Q4 results on Thursday, with results in line with analyst expectations. While its attrition cooled down in line with that of its peers TCS and Infosys, it also guided for 6-8% revenue growth, nearly half of its FY23 growth of 13.7%. <cmsannotation type="cmsannotation" annotationid="Global markets in the red" comment="subhead" text="Global markets in the red">Global markets in the red</cmsannotation> Markets in the US closed in the red on Thursday, with Dow Jones declining 0.33% while S&amp;P 500 fell 0.6%. The tech-heavy Nasdaq was down 0.8%. Asian markets were largely in the red, too, on Friday morning. KOSPI declined the most at 0.72%, while Hang Seng was a close second with a fall of 0.67%. Shanghai Composite was down 0.54%, while Taiwan Weighted was down 0.24%. Nikkei 225 was flat. Gold prices edged up a little to INR 60,508 per 10 grams ahead of the auspicious occasion of Akshay Tritiya which sees an increase in purchase of the yellow metal. Crude oil prices continued to cool down, with Brent crude now hovering around the $81 per barrel level. <cmsannotation type="cmsannotation" annotationid="Stocks to watch" comment="subhead" text="Stocks to watch"><keyword id="73648" type="General" weightage="20" keywordseo="stocks-to-watch" source="Orion">Stocks to watch</keyword></cmsannotation> HCL Technologies: The IT company’s revenue grew 13.7% in FY23 in constant currency terms and also met its FY23 revenue forecasts as it had guided it to be anywhere between 13.5-14%. Its operating margin fell sharply in Q4 to 18.1% in Q4 from 19.6% in Q3. ICICI Life Insurance: The insurer has reported a 27% growth in net profit at ₹235 crore as compared to ₹185 crore in the previous year period aided by a strong growth in value of new business. <keyword id="28423" type="General" weightage="100" keywordseo="vedanta" source="Orion">Vedanta</keyword>: Billionaire Anil Agarwal owned company has pledged 2.44% stake in group company <keyword id="115997" type="General" weightage="80" keywordseo="hindustan-zinc" source="Orion">Hindustan Zinc</keyword> to raise ₹1,500 crore as it is struggling to meet its debt obligations. With this, Vedanta’s pledged shares in Hindustan Zinc rose to 91.35% or about 59.3% of the company’s overall shares. Rail Vikas Nigam: The consortium of the company and Siemens received two separate orders from Gujarat Metro Rail for phase 1 of Surat Metro and phase 2 of Ahmedabad metro. Earnings today: Reliance Industries, Hindustan Zinc, Aditya Birla Money, Tejas Networks, Bheema Cements, Metalyst Forgings among companies to report March quarter earnings today. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/news/hcl-tech-projects-its-revenue-to-grow-between-6-8-in-fy24/articleshow/99644337.cms">HCL Tech projects its revenue to grow between 6-8% in FY24</a> <a href="https://www.businessinsider.in/finance/news/here-are-the-many-ways-you-can-invest-in-gold-this-akshaya-tritiya/articleshow/99635639.cms">Here are the many ways you can invest in gold this Akshaya Tritiya</a> <a href="https://www.businessinsider.in/business/corporates/news/sbi-icici-bank-ongc-tata-motors-bpcl-will-drive-niftys-earnings-in-q4-2022-23/slidelist/99632153.cms">5 companies that will drive Nifty’s earnings in Q4</a>

Sensex, Nifty50 edge lower amid negative global cues: Realty, metal and auto stocks decline

New Delhi, March 3 () Moody's Investors Service on Tuesday said it has downgraded Vedanta Resources Limited's (Vedanta) corporate family rating (CFR).The rating was downgraded to B1 from Ba3."Moody's Investors Service has downgraded Vedanta Resources Limited's(Vedanta) CFR to B1 from Ba3," it said in a statement.Moody's Corporate Family Ratings (CFR) are opinions on a corporate family's ability to honour all of its financial obligations.The agency said it has also downgraded the rating on senior unsecured bonds issued by Vedanta and those issued by its wholly owned subsidiary, Vedanta Resources Finance II Plc and guaranteed by Vedanta, to B3 from B2.The outlook on all ratings is stable, the statement said."Today's downgrade of Vedanta's ratings was triggered by a sustained deterioration in the company's credit profile, and our expectation that its credit metrics will remain weak for the previous ratings," said KaustubhChaubal, Moody's Vice President and Senior Credit Officer.The agency said the low and volatile commodity price environment will mean that Vedanta's earnings are unlikely improve significantly.Consequently, the company's financial profile will take longer than anticipated to strengthen, it said."The rating actions also reflect Moody's revised view on the treatment of the loan raised in 2018 by Vedanta's sole shareholder, Volcan Investments, for Vedanta's privatization," the statement said.Its earlier analytical approach to assess Vedanta's credit strength was based on the separation of Vedanta and its operating subsidiaries from its shareholder, and the expectation that Volcan will not require Vedanta to service any of its debt obligations."However, we now expect Vedanta to pay an additional dividend towards meeting Volcan's upcoming debt maturity. While we note that the additional dividend will be adjusted towards reducing dividend payments in the next fiscal year, it blurs the separation between the two companies," Chaubal added.The B1 CFR is supported by Vedanta's large scale and diversified low-cost operations that produce a wide range of commodities such as zinc, oil and gas, aluminum, iron ore and power, it said.In addition, the company's strong position in key markets that enable it to command pricing premium and track record of generating stable margins through commodity cycles support its business profile, and are key credit strengths, the statement said.The company has USD 1.9 billion of debt maturing at the holding company, which comprises the USD 670 million bond due in June 2021 and USD 1.2 billion of bank loans that have a staggered maturity. Vedanta's liquidity is weak at the holding company level and Moody's estimates the holding company held cash of less than USD 50 million as of December 31, 2019.The holding company's cash needs until September 2021 include USD 1.9 billion of debt maturities - - USD 670 million bond due in June 2021; Volcan's entire USD 625 million privatisation debt interest expense of USD 500 million and regular dividend payments.Further, the stable outlook incorporates Moody's expectation that Vedanta will upstream cash dividends from its operating subsidiaries to itself to repay debt and complete refinancing for the balance of the holding company debt in a timely manner.However, a delay in completing refinancing at least 12 months prior to the relevant maturity dates will exert negative pressure on the ratings, Moody's said.For the 12 months to September 30, 2019, Vedanta Resources generated revenues of USD 13.7 billion and adjusted EBITDA of USD 3.3 billion. NAM PSK BAL

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Vedanta has $3 billion debt servicing obligations this fiscal: S&P

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Anil Agarwal makes 'zero debt' pledge, says 'very comfortable' servicing debt

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Vedanta cuts debt by $2 billion ahead of target to soothe investor concerns

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Sensex, Nifty50 edge lower amid negative global cues: Realty, metal and auto stocks decline

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Moody's downgrades Vedanta Resources' corporate family rating

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