Here’s why Vedanta remains CLSA’s top sector pick

People walk past a bronze replica of a bull at the Bombay Stock Exchange (BSE) building in Mumbai November 3, 2008. The BSE Sensex provisionally closed up 5.89 percent on Monday, with sentiment buoyed by the Reserve Bank's cuts in interest rate and reserve requirements over the weekend. Photo: REUTERS

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26 Aug, 2025 12:21

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Vedanta witnessed selling pressure on Wednesday as the stock dipped over 2 percent intraday on the back of fall in global commodity prices.

However, CLSA is upbeat on the stock going forward and has pegged it to be its top pick in the sector. It has maintained a buy call on the stock with an increased target price of Rs 340 from Rs 300.

Potential catalysts for the stock are Cairn merger completion as well as possible dividend.

The brokerage house is betting on the company’s ramp up plans. It feels that the firm is on track to fully ramp up its new aluminium and power capacity over FY18-19. Vedanta is also looking at multiple growth projects on its radar beyond FY19, the research firm added.

On financial impact, it foresees a 25-30 percent boost to consolidated earnings before interest, taxes, depreciation and amortisation if all projects materialise. Adding to that, the valuations look attractive as well, it said.

The stock has gained over 14 percent in the past three months, while its three-day fall stood at 2.02 percent. At 14:02 hrs, it was quoting at Rs 259.10, down Rs 2.55, or 0.97 percent, on the BSE. It touched an intraday high of Rs 259.40 and an intraday low of Rs 256.00.