Vedanta shares jump 3% as firm fixes record date for first dividend after demerger. What to expect?
The company announced the record date and the board meeting scheduled for the dividend announcement in an exchange filing released on Monday. Vedanta is typically closely watched by investors for its consistent tradition of dividend payments.
Vedanta dividend record date
Fixing the record date on October 14 implies that only shareholders who own Vedanta shares in their demat accounts as of that date will be eligible to receive the dividend. Due to Sebi’s T+1 settlement norm, October 13 will effectively be the last day to buy Vedanta shares to be eligible for the reward.
Vedanta has declared 49 dividends since July 23, 2001 and at the current share price, its dividend yield stands at more than 4.3%, according to data on Trendlyne. Earlier this year, the company paid an interim dividend of Rs 11 per share in March.
Last year, the company announced two interim dividends: Rs 16 in August and Rs 7 in June. 2024 was a bumper year in terms of dividend payouts, as the company announced four dividends cumulatively worth Rs 43.5 per share.
Also Read | Vedanta dividend countdown: Anil Agarwal-led company to consider first FY27 payout on October 8
Vedanta’s first dividend announcement after demerger
Notably, this latest dividend announcement will be the first since the company demerged into five entities, resulting in an adjustment to the share price of the original Vedanta.Four new entities spun out of the company in June: Vedanta Aluminium Metal (VAML), Vedanta Power, Vedanta Oil and Gas and Vedanta Iron and Steel, marking one of the biggest corporate restructurings in India’s metals and mining space.
How demerger can affect Vedanta’s dividend payout?
From a dividend perspective, the Vedanta demerger may change the yield for residual Vedanta (which houses Hindustan Zinc, Zinc International and base metal business), said Sunny Agrawal, Head of Fundamental Research at SBI Securities. He explained that the company will likely remain a dividend‑paying entity, but its absolute dividend per share (DPS) can decline structurally as several large cash‑generating businesses have been carved out.
Post‑demerger, Vedanta’s dividend payout will be driven primarily by Hindustan Zinc’s (60.71% stake) earnings (led by LME Zinc and silver prices), increasing commodity sensitivity, the analyst said. He added that investors who previously viewed Vedanta as a single, high‑yield proxy will now need to own a basket of the demerged entities to approach similar aggregate yields.
“Over time, improved capital allocation and governance across standalone entities could support healthy group‑level cash returns, but dividends will be more volatile, more cycle‑dependent, and more business‑specific, requiring an active allocation strategy rather than reliance on Vedanta,” the analyst said.
Also Read | Vedanta demerger: How will the mega restructuring impact dividend payouts for shareholders?
Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.
