InvestorQ : If Vedanta wanted to demerge the business, why did it merger about 3 year back?
Crowny Pinto made post

If Vedanta wanted to demerge the business, why did it merger about 3 year back?

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7 days ago
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In the last 20 years, Vedanta bought majority stakes in Balco, Sesa Goa, Hindustan Zinc, Madras Aluminium and Cairn India. As you rightly said, in 2018, it integrated all businesses except HZL and Balco. Now it is not happy with the SOTP story as the company has not gained from the metals and commodity rally. Now the thinking is that demerging would be a better idea as the parts will be more valuable than the whole.

Initially, Vedanta group tried to position itself as the next Anglo-American or Broker Hill Proprietary. That is not working. The pandemic put pressure on mines but due to weak demand supply cuts did not spike prices. Now when prices are rising, the cream of value is cornered by the focussed plays. It remains to be seen if it is too late for such a bet on the commodity cycle.

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