Vedanta Shares Dip 8% Amidst Metals Sell-off; Analysts Hike Targets Post-Demerger Clarity

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AuthorIshaan Verma|Published at:
Vedanta Shares Dip 8% Amidst Metals Sell-off; Analysts Hike Targets Post-Demerger Clarity
Overview

Vedanta Ltd. experienced an 8% share price decline on Friday, January 30, mirroring a broader global metals market downturn. This occurred despite the company reporting a robust 60% year-on-year increase in Q3 FY26 profit to ₹7,807 crore and a 19% revenue rise to ₹45,899 crore. Analysts responded positively to the financial performance and demerger clarity, with several brokerages raising price targets, reflecting optimism in future value unlocking.

### Market Reaction and Analyst Optimism

Vedanta Ltd. shares tumbled 8% on Friday, January 30, as a broad sell-off gripped global metals markets. [cite: Original News, NEWS1] The decline occurred despite the mining conglomerate reporting better-than-expected year-on-year financial results after market close on Thursday. [cite: Original News, NEWS1] This divergence between immediate market sentiment and analyst outlook highlights potential underlying strength as the company moves forward with its strategic demerger.

### Aggressive Price Target Hikes

Several analysts have significantly raised their price targets for Vedanta following the results and outlook. Investec now holds the highest target at ₹930, a substantial increase from its previous ₹700. [cite: Original News, NEWS1] Citi also boosted its target to ₹900 from ₹585, initiating a "buy" recommendation. [cite: Original News, NEWS1] Even JPMorgan, maintaining a "neutral" rating, raised its price target to ₹680. [cite: Original News, NEWS1]

### Drivers of Bullish Stance

Citi's optimism stems from several key factors, including comfortable parent company leverage and a projected upside for Aluminium on the London Metal Exchange, with prices seen at $3,425 in FY2027 compared to the current spot price of $3,250. [cite: Original News, NEWS1] Anticipated volume growth, cost reductions, and the successful completion of the demerger process underpin this positive view. [cite: Original News, NEWS1] The brokerage forecasts a dividend payout of ₹40 per share for the current financial year, with ₹23 already distributed. [cite: Original News, NEWS1]

### Analyst Consensus and Strategic Outlook

The analyst community remains largely supportive. Of the 14 analysts covering Vedanta, none recommend selling; ten suggest "buy," while four rate the stock "hold." [cite: Original News, NEWS1] The National Company Law Tribunal (NCLT) approved the plan to split Vedanta into five independently listed entities on Tuesday, January 27, 2026. This demerger, targeted for completion by March 2026, aims to create dedicated, pure-play business units. Each shareholder is expected to receive one share in each of the new entities, allowing for clearer valuation and independent growth potential. Despite a 3.01% drop on January 8, 2026, and today's 8% decline, Vedanta shares have gained 18% year-to-date in January, reaching a high of ₹755 on January 29. [cite: Original News, NEWS1, 5] Vedanta reported record Q3 FY26 results, with Profit After Tax surging 60% year-on-year to ₹7,807 crore and revenue climbing 19% to ₹45,899 crore, alongside a record EBITDA of ₹15,171 crore. The company also projects record annual EBITDA exceeding $6 billion for FY26.

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