Vedanta Aluminium shares tumble 14% in 3 days since listing. What’s dampening the shine of Vedanta’s new crown jewel?

Shares of Vedanta Aluminium Metal tumbled 5% again to hit the lower circuit for the third consecutive session, falling 14% in just three days since listing and wiping off over Rs 29,000 crore from the market capitalisation of what analysts called the new “crown jewel” of Vedanta.

Vedanta Aluminium Metal shares remained locked in the lower circuit at Rs 447.56 apiece on Wednesday. The shares debuted at Rs 522 apiece on NSE on Monday after a special pre-open session. The largecap company’s market capitalisation at debut stood at more than Rs 2 lakh crore, surpassing parent Vedanta’s total market capitalisation. Its market cap has now fallen to Rs 1.75 lakh crore.

Also read: Vedanta Aluminium lists at Rs 527 on BSE after demerger

Is Vedanta Aluminium the new ‘crown jewel’ of Vedanta?

Before the market debut, ICICI Direct said that Vedanta Aluminium stood out as the most attractive entity. “This is supported by its strong contribution to group revenues and margins, along with favourable industry dynamics such as tight global supply, elevated aluminium prices, and ongoing capacity expansions driving volume growth,” it added.

ICICI Securities was also the most bullish on the aluminium business, saying the Iran-US conflict could result in a larger-than-expected aluminium supply deficit. It called Vedanta Aluminium, the group’s new “crown jewel”.

Also read: Why Vedanta’s aluminium business is the undisputed crown jewel of the mega 4-way demerger

Vedanta Aluminium Metal is the largest aluminium producer in India, as well as in the US, Europe, the Middle East, Australia and Africa, according to the company. It produced more than half of India’s aluminium at 2.42 million tonnes in FY25, its website said. It operates a 5 MTPA alumina refinery in Odisha’s Kalahandi district, along with the world’s largest aluminium plant at Jharsuguda, Odisha, with a 1.85 MTPA capacity. It also operates Bharat Aluminium Company Limited (BALCO) in Chhattisgarh.

ICRA recently removed the long-term rating of Vedanta Aluminium Limited (VAML) from “watch with developing implications,” following greater clarity on the allocation of assets and liabilities under Vedanta Limited’s ongoing demerger scheme, as well as the support framework across group entities. ICRA also upgraded the rating and assigned a stable outlook to the long-term rating.

Also read: Vedanta Aluminium vs Vedanta Power; Which can give investors better wealth in Rs 2 lakh crore demerger play

Why are Vedanta Aluminium shares falling?

The sharp drop in Vedanta Aluminium’s share price comes amid falling aluminium prices after Iran and US agreed to a peace deal. US President Donald Trump announced on Sunday that the much-awaited agreement has been finalised, following which global stock markets rallied, with Dalal Street being no exception.
Aluminium producers from the Middle East typically account for nearly 9% of global supply, and the suppliers use the narrow 33-kilometre waterway connecting the Persian Gulf with the Gulf of Oman to ship their metal to global markets and import raw materials. The reopening of the Strait of Hormuz may lead to further downturn in aluminium prices, which can bear an impact on the Indian aluminium producers.

How are the other newly-listed Vedanta stocks performing?

The shares of Vedanta Iron and Steel jumped 5% to hit the upper circuit for the third consecutive session on Wednesday, rallying over 16% since listing. Vedanta Power shares have fallen around 2% from its listing price, while those of Vedanta Oil and Gas hit the 5% lower circuit for the third straight session, falling over 14% since market debut.
Also read: Vedanta demerger unlocks 20% value; Aluminium arm becomes most valuable

(With inputs from agencies)

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