Key facts
- Vedanta will be removed from MSCI Global Standard Indexes effective June 22.
- The removal follows Vedanta's completion of a demerger into five separate listed entities.
- The residual Vedanta entity now has a significantly smaller market capitalization.
- Four new businesses—Vedanta Aluminium, Vedanta Power, Vedanta Oil & Gas, and Vedanta Iron & Steel—debuted on the stock market on Monday.
- Vedanta Aluminium listed as a large-cap stock with a market capitalization of Rs 2.06 lakh crore.
Vedanta's shares are slated for removal from the MSCI Global Standard Indexes on June 22, following the company's extensive demerger process. The conglomerate has been split into five distinct listed entities, leaving the residual Vedanta with a substantially reduced market capitalization.
The final stage of this corporate restructuring was completed on Monday, with four newly formed businesses—Vedanta Aluminium, Vedanta Power, Vedanta Oil & Gas, and Vedanta Iron & Steel—making their debut on the stock market. Vedanta Aluminium emerged as the sole large-cap entity among the new listings, opening at Rs 527 per share on the BSE with a market valuation of Rs 2.06 lakh crore, surpassing its parent company.
Vedanta Power, Vedanta Oil & Gas, and Vedanta Iron & Steel debuted at Rs 41.30, Rs 39, and Rs 22 per share, respectively. The demerger plan, announced in April, involved shareholders receiving one share in each of the four new companies for every share held in Vedanta on the record date, which was set as May 1.
Analysts at Nuvama had previously noted that Vedanta held a significant weight in emerging market and FTSE indices. They anticipated that most Vedanta entities, with the exception of Vedanta Aluminium, would be removed from these indexes or potentially moved to small-cap indexes, depending on index criteria and cut-off dates. FTSE was expected to retain Vedanta and Vedanta Aluminium while the treatment of other demerged entities remained uncertain.
Such adjustments in major indexes typically lead to share price volatility. In response to the news, Vedanta shares experienced a decline of over 2%, trading below Rs 296 per share.