LONDON: Vedanta Resources Limited (“VRL or the company”), the world’s leading natural resources, energy, and technology conglomerate today announced that S&P Global Ratings (“S&P”) has upgraded its ratings from ‘CCC+’ to ‘B-‘ citing the company’s improving capital structure and liquidity while assigning a stable outlook.

The rating upgrade reflects VRL’s strong credit profile with a long-standing record of delivering superior performance and healthy free cash flows. VRL has been significantly deleveraging its balance sheet leading to a robust capital structure that supports sustainable growth over the long-term.

S&P revised its estimates on VRL’s earnings, estimating the EBITDA for fiscals 2025 and 2026 to be in the range of US$5.5 billion – US$6.0 billion annually.

The rating agency also estimates the debt at the Vedanta Resources level to decline by another US$1 billion to about US$4.5 billion over the next 12 months. It also estimates interest expenses at the Vedanta Resources level to drop to US$550 million–US$600 million by the end of fiscal 2025 (ending March 31, 2025).

S&P noted in its research update that VRL has adequate internal funds to meet US$1.4 billion of debt maturities due by the end of 2025. The stable outlook reflects our view that the company will proactively address the maturity of US$1.2 billion of debt in April 2026, the firm said in its research update.

Key factors noted by S&P in its research update include:

• VRL’s strengthening cash flow position and the recent increase in the valuation of Vedanta Ltd. shares improve funding flexibility.
• VRL’s earnings are benefitting from favorable product prices and cost-reduction initiatives, particularly in the aluminum business.
• S&P expects zinc EBITDA to increase by about 25% and aluminum by almost 50% in fiscal 2025.

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