What happens after a mega demerger finally goes through? That is the big question investors are asking as Vedanta steps into a new structure. With its long-awaited split now effective, the company has reorganised itself into five separate businesses, each focusing on a specific segment such as aluminium, oil and gas, power, iron and steel, and the existing Vedanta entity.
The stock turned ex-demerger on April 30, just ahead of the record date of May 1, 2026. This means investors who held shares before the cut-off will now receive shares in the newly demerged companies.
But while the restructuring is now behind it, the market is shifting focus to valuations and future growth.
Motilal Oswal on Vedanta: Cautious view
The brokerage house Motilal Oswal has come up with its outlook on the stock. They have taken a cautious stance on the Vedanta group stocks. The firm has assigned a target price of Rs 800 and maintained a ‘Neutral’ rating, indicating limited upside of around 3% from current levels.
According to the brokerage report, “The stock currently trades at 6.6x EV/EBITDA on the FY28 estimate. The combined fair value on the SoTP basis comes to around Rs 800/share, with the largest contributing verticals such as Aluminum and Zinc. We reiterate our ‘Neutral’ rating on the stock.”
Vedanta: Q4 performance
The company’s recent financial performance showed strong growth. According to the Motilal Oswal report, the Q4FY26 results were largely in line with expectations. This is supported by better production volumes and favourable commodity prices.
“Vedanta’s Q4FY26 performance came largely as expected, supported by better volumes and favourable LME prices,” the report noted.
Revenue for the quarter came in at around Rs 52,800 crore, rising 31% year-on-year and 13% sequentially.
Operating performance also remained strong. EBITDA stood at about Rs 18,400 crore, up 61% year-on-year. Margins improved to 34.9%.
Profit after tax (adjusted profit after tax or APAT) came in at Rs 10,650 crore, more than doubling compared to last year.
Vedanta: Growth plans and financials in focus
Motilal Oswal in its report noted that the company is aiming to sustain earnings growth through expansion and efficiency improvements.
“Management targets to maintain strong growth in earnings, driven by the upcoming capacity supporting higher VAP products and a favorable pricing environment,” added the brokerage house.
At the same time, the company is focusing on reducing its debt burden.
“Vedanta remains firm on its deleveraging plans, and going forward, higher cash flows will support both its expansion plans and deleveraging efforts,” noted the report.
Net debt stood at around Rs 53,200 crore at the end of March 2026, with a net debt-to-EBITDA ratio of 0.95 times.
Aluminium and zinc lead the show
The aluminium and zinc businesses continue to be the biggest contributors to overall performance.
In the aluminium segment, revenue stood at about Rs 18,700 crore, with EBITDA rising sharply to around Rs 8,500 crore.
The zinc business, particularly Hindustan Zinc, also delivered strong results. Revenue came in at around Rs 13,500 crore, while EBITDA stood at Rs 7,700 crore.
According to the brokerage report, “Hindustan Zinc (HZ) reported revenue of Rs 135 billion (+49% YoY and +23% QoQ) for 4QFY26, beating our estimate of Rs 116 billion.”
Margins in this segment remained strong, with EBITDA margin nearing 57%.
Vedanta Group: What changes after the demerger?
The restructuring officially comes into effect from May 1, 2026.
“Vedanta to demerge into five independently listed entities w.e.f. 1st May’26 – 1) Aluminum, 2) Oil & Gas, 3) Power, 4) Iron & Steel, and 5) Vedanta, with the residual operation, which will retain the HZL business.”
This means the existing Vedanta entity will largely hold the zinc business and other residual operations, while the other segments will function as separate listed companies.
Disclaimer: The information provided is based on a brokerage report and market data; it is for informational purposes only and does not constitute a buy, sell, or hold recommendation. Investors are advised that stock market investments are subject to market risks and should consult a SEBI-registered investment advisor before making any financial decisions based on target prices or demerger valuations. The views expressed by brokerage firms are their own and do not reflect the editorial stance of this publication.
This disclaimer has been generated using AI to support user well-being and responsible content consumption.