Hindustan Zinc on Wednesday announced a floor price of Rs 486 per share for the offer for sale (OFS). The floor price is 15.2 per cent below its last close of Rs 573 on the BSE.
Through the OFS, promoter Vedanta plans to offload up to 3.17 per cent stake, or 133.7 million equity shares. At the base price, the OFS will fetch Rs 6,500 crore.
The OFS will take place on Friday for non-retail investors and on Monday for retail investors, who have a reservation of 10 per cent of the shares on offer. A total of 133.7 million shares are on offer.
At the end of June 2024, Vedanta held a 64.92 per cent stake, while the central government held 29.54 per cent in Hindustan Zinc, which is currently valued at Rs 2.42 trillion. Cash-positive, Hindustan Zinc is the country’s largest producer of zinc.
Anil Agarwal-led Vedanta and its UK parent Vedanta Resources (VRL) have embarked on a drive to reduce their debt.
In June, Finsider International, a unit of VRL, sold a 2.6 per cent stake in domestically listed Vedanta to mobilise Rs 4,184 crore, which was used to pare its debt. At the end of June, Vedanta's net debt was Rs 61,324 crore, and gross debt stood at Rs 78,016 crore. As of March 31, VRL’s debt levels stood at around $6 billion.
In July, Vedanta also raised Rs 8,500 crore (nearly $1 billion) in fresh capital by issuing 193.1 million new equity shares at an issue price of Rs 440 apiece through the qualified institutional placement route.
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At the end of July, global rating agency S&P Global Ratings upgraded VRL’s rating to 'B-' (a stable rating) from 'CCC+', citing an improving capital structure and liquidity.
The stable outlook reflects our view that the company will proactively address the maturity of $1.2 billion of debt in April 2026, the rating agency said in its research update.