Vedanta Shares Tank 6%+ on Commodity Correction Despite Robust Q3 Earnings
Vedanta shares decline over 6% amid a metal sector selloff, despite a 60% rise in Q3 profit to Rs 7,807 crore.
Shares of Vedanta Ltd fell sharply on Thursday, dropping over 6% despite reporting strong results for the December quarter. The metals-to-oil conglomerate posted a 60% year-on-year jump in net profit to ₹7,807 crore, up from ₹4,876 crore in the same period last year. Revenue for the quarter also rose 19% to ₹45,899 crore, driven by higher base metal prices, increased sales volumes, improved premiums, and favourable currency movements.
Market analysts attributed the steep decline in Vedanta shares to broader selling pressure in the metals sector. Precious metals, including gold and silver, experienced a sharp correction, with silver dropping nearly 10% from its recent peak. The downward trend weighed on sector sentiment, affecting companies such as Hindustan Zinc, Hindustan Copper, and NALCO. Hindustan Copper fell 10.5% to ₹679.20, NALCO dropped 9.4% to ₹388.45, and Hindustan Zinc declined 7.3% to ₹663.30 during the session.
Despite the market setback, investor confidence in Vedanta remains relatively strong. Of the 14 analysts covering the stock, 10 maintain a ‘buy’ rating, while four have a ‘hold’ recommendation. Bloomberg data indicates a 12-month target price of ₹763.08, suggesting a potential upside of around 6% from current levels.
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The sharp decline in metal stocks follows a broader trend in commodity markets. Silver, in particular, fell 6% on Friday as a firmer US dollar dampened investor sentiment, although it still showed strong monthly performance. The correction comes after silver reached an all-time high of ₹420,048 per kg on January 29, before retreating to ₹375,900 per kg, representing a pullback of over ₹44,000.
Vedanta’s quarterly performance highlights the company’s strong fundamentals and resilience amid volatile market conditions. The firm’s robust earnings and revenue growth underscore the ongoing strength of base metal prices and favourable market dynamics. Analysts note that while short-term volatility may persist, Vedanta remains a key player in India’s metals sector, supported by diversified operations across mining, oil, and energy businesses.
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