Vedanta Aluminium Metal shares experienced a 5% decline on Tuesday, closing at Rs 475.65 against the previous day's Rs 500.65. This dip, which saw the company's market capitalization slide to Rs 1.85 lakh crore, marks the second consecutive session of losses since its listing.
On its debut day, June 15, the stock closed 5% lower than its opening price of Rs 527. However, market analysts suggest that this initial correction may not accurately reflect the near-term outlook for the recently demerged Vedanta Group entity.
India's Largest Aluminium Producer Eyes Global Leadership
Vedanta Aluminium stands as India's largest aluminium producer and ranks as the third-largest globally, excluding China. In the fiscal year 2025, the company accounted for over half of India's aluminium output, producing 2.42 million tonnes. Its operations include the world's largest aluminium smelter located in Jharsuguda, Odisha.
The company has ambitious plans to significantly expand its production capacity. It aims to double its output to 6 million tonnes per annum (mtpa) over the next three years. This strategic move is intended to position Vedanta Aluminium as the world's largest fully integrated aluminium producer, while also establishing it as one of the industry's lowest-cost manufacturers.
Analyst Confidence Amidst Market Fluctuations
Despite the recent stock correction, analysts maintain a positive outlook for Vedanta Aluminium. Emkay Global Financial Services, for instance, has highlighted a strong case for a re-rating of the stock. Data compiled from seven brokerages indicates an average fair value of Rs 463.21 for the shares.
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, encouraged investors to consider Vedanta Aluminium Metal as a potential investment opportunity. He cited the company's ongoing capacity expansion initiatives and favorable trends in London Metal Exchange (LME) aluminium prices as key drivers supporting this investment thesis.
Further bolstering confidence, rating agency ICRA recently assigned an ICRA AA+ rating with a stable outlook to the demerged entity, Vedanta Aluminium Metal Limited. This rating underscores the company's strong financial health and operational stability.