India’s metal & mining major Vedanta Ltd will distribute INR 125.9bn ($1.6bn) from its accumulated general reserves as a special dividend to its shareholders at INR 33-35/share ($0.41-0.44/share). The board meeting is scheduled on October 11 for the dividend approval. Vedanta believes that its general reserve funds are higher than its anticipated operational and business needs in the future. The company said in an exchange filing that “…these excess funds can be utilized to create further shareholders’ value… Steady growth in sales volume, and balanced capital expenditure for continuing operations has helped the Company achieve a strong track record of generating cash flows.” Since April 2022, Vedanta has already distributed a total of INR 50.5/share ($0.63/share) in dividends which helped its international holding company and parent Vedanta Resources Ltd (VRL) pay their debt, optimize liquidity and reduce refinancing risk.
VRL’s dollar bonds were trading up with its 7.125% 2023s up over 0.1 points to 93.25 cents to the dollar, yielding 18.8%.
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