Research Update: Vedanta Resources Ltd. Downgraded To 'B' On Weaker Operating Performance; Outlook Stable

Lower zinc prices and muted profitability in aluminum will keep Vedanta Resources Ltd.'s (Vedanta Resources) credit ratios materially lower than our rating thresholds for the next one to two years. Vedanta Resources' operating performance remains on track but is unable to offset the drag from a high debt burden that includes the US$900 million in debt that its parent Volcan Investments Ltd. (Volcan Investments) took out to delist Vedanta Resources from the London Stock Exchange in 2018. On Nov. 5, 2019, S&P Global Ratings lowered its long-term foreign currency issuer credit rating on Vedanta Resources and its long-term issue rating on the various issues of U.S. dollar-denominated senior unsecured notes the India-based commodities producer guarantees to 'B' from 'B+'. The

...- Lower zinc prices and muted profitability in aluminum will keep Vedanta Resources Ltd.'s (Vedanta Resources) credit ratios materially lower than our rating thresholds for the next one to two years. - Vedanta Resources' operating performance remains on track but is unable to offset the drag from a high debt burden that includes the US$900 million in debt that its parent Volcan Investments Ltd. (Volcan Investments) took out to delist Vedanta Resources from the London Stock Exchange in 2018. - On Nov. 5, 2019, S&P Global Ratings lowered its long-term foreign currency issuer credit rating on Vedanta Resources and its long-term issue rating on the various issues of U.S. dollar-denominated senior unsecured notes the India-based commodities producer guarantees to 'B' from 'B+'. - The stable outlook reflects our view that the company will deleverage from increasing volumes amid stable operating conditions to add more headroom on financial ratios within the bounds of the rating....

Research Update