Vedanta shares sink 62% on ex-demerger price adjustment

What happened to Vedanta’s share price

Vedanta Ltd shares opened sharply lower on Thursday after the stock began trading on an ex-demerger basis. On the NSE, the discovered ex-demerger price was Rs 289.5, reflecting a drop of more than 62% from Wednesday’s close of Rs 773.6. On the BSE, the price settled at Rs 290.5 after the same price discovery process.

The move looked like a steep fall on trading screens, but it primarily reflected a mechanical adjustment. The stock price was reset to exclude the value of four businesses that are being demerged into separate listed companies.

Why the stock fell on screens, but the story is different

The sharp adjustment came because Vedanta’s aluminium, power, oil and gas, and steel businesses are being carved out. Once a stock turns ex-demerger, the parent company’s quoted price excludes the value that will sit in the soon-to-be-listed entities.

This is why the fall from around Rs 773 to around Rs 289 did not, by itself, represent a like-for-like erosion of shareholder value for eligible holders. Eligible shareholders are set to receive shares in the new entities in addition to holding the residual Vedanta business.

The special pre-open session and how price discovery worked

The exchanges ran a special pre-open session (SPOS) on Thursday between 9:15 am and 9:45 am to discover the ex-demerger price. Regular trading in the stock began at 10 am.

The SPOS was held because May 1, the record date announced by Vedanta, falls on a market holiday due to Maharashtra Day. The discovered price during this special session set the reference for trading when the stock moved to an ex-demerger basis.

Key dates: ex-demerger trading and the record date

From April 30, Vedanta shares started trading on an ex-demerger basis, ahead of the May 1 record date. Because May 1 is a trading holiday, Thursday (April 30) effectively became the key session around the corporate action.

Investors who bought Vedanta shares on or before April 29 are eligible for the demerger entitlement. Investors buying from April 30 onwards are not eligible for the benefits tied to the record date.

What shareholders get: one share in each new company

As part of the restructuring, Vedanta will demerge four business verticals into separate listed entities. Shareholders holding Vedanta as of the record date will receive one share in each of the four new companies for every Vedanta share held.

The four resulting entities referenced in reports around the demerger include:

• Vedanta Aluminium Metal Ltd (VAML)
• Talwandi Sabo Power Ltd (TSPL)
• Malco Energy Ltd (MEL)
• Vedanta Iron and Steel Ltd (VISL)

Separately, the businesses being spun off were described as aluminium, power, oil and gas, and steel.

Market cap shift and what changed after the reset

The ex-demerger reset also changed Vedanta’s visible market capitalisation. After the stock opened at Rs 289.50 on Thursday, Vedanta’s market capitalisation was cited at around Rs 1.13 lakh crore, versus around Rs 3 lakh crore before the adjustment.

This gap is consistent with the “subtraction” of value of the demerged businesses from the parent’s quoted price. The difference between Wednesday’s closing price and Thursday’s discovered price is expected to be used to determine the valuation of the demerged entities.

How the stock traded after opening

After the ex-demerger price discovery, Vedanta remained in focus in a weak broader market. One report noted the Nifty 50 was down 254.95 points or 1.05% to 23,922.70 during the session.

Within the session, Vedanta was reported trading lower by 5.08% at Rs 275.75 later in the day after opening on the adjusted basis. Another update noted the stock fell 6% during regular trading. A separate data point showed the stock slipping over 5% to Rs 274.30.

Analyst expectations and why volatility is a key theme

Broker commentary around the event pointed to a wide expected range for post-demerger trading levels. ICICI Direct said Vedanta’s stock price was expected to adjust for the demerger and trade in the range of Rs 300-325 per share, while other commentary referenced a broader Rs 250-325 band.

SBI Securities’ Sunny Agrawal cited a fair value range of Rs 250-290 per share for the residual base metal business and its holding in Hindustan Zinc after the special pre-open session. Another analyst note also flagged potential volatility due to adjustments by active and passive funds in the days following the corporate action.

Other investor datapoints mentioned alongside the demerger

One report also linked investor attention to Vedanta’s results and distribution. It noted Vedanta’s Q4 net profit surged 89% and referenced an FY26 dividend of Rs 34 per share.

Vedanta shares were also described as part of the Nifty Next 50 index, which can matter for flows and rebalancing considerations during corporate actions.

Snapshot table: prices, dates, and eligibility

What to watch next

The immediate price adjustment answered the first question investors had: what the residual Vedanta stock would trade at once the value of the demerged units is excluded. The next key market reference will be how the demerged entities are valued when they list, since the “missing” value is expected to be reflected there.

For now, the near-term focus remains on volatility around the ex-demerger transition, and on the next disclosures tied to the valuation and listing process for the four new businesses.