Vedanta's Agarwal Bets on Oil and Gas Growth With Four-Way Listing

Vedanta's Anil Agarwal said oil and gas would become one of the company's largest businesses. The plan involves listing four separate subsidiaries at once, a move he said would unlock growth and boost government tax revenue.

Vedanta already holds some of India's biggest oil and gas fields through its Cairn unit. Agarwal's statement positions that division as a core driver, alongside the company's aluminium and steel operations. The listing plan effectively lets the market price each business separately.

Agarwal said the restructure would create millions of jobs and "significantly" increase tax inflows. He did not provide a timeline or specify which exchanges the listings would target.

The oil and gas segment is already the most profitable piece of Vedanta's portfolio by margin, according to company filings. Spinning it off could attract a higher valuation from energy-focused investors, while the remaining metals and mining entities would still carry commodity-cycle risk.

A direct listing also ends the conglomerate discount that has dogged Vedanta's stock for years. Each unit would trade on its own fundamentals, with capital allocation decisions made independently. That gives investors more precise exposure – oil and gas exposure without the drag from zinc or copper.

The stock has lagged larger Indian miners this year, partly over governance concerns and debt levels at the parent. A clean break via four separate entities would let the market reassess each piece.

Agarwal's statement underscores Vedanta's ambition to be mainly an oil and gas producer over time. The company already produces roughly a fifth of India's domestic crude. Any ramp-up would further tie Vedanta to global oil prices, a double-edged sword given the recent pullback in crude from 2022 highs.

Vedanta shareholders will vote on the demerger plan once the board finalises the structure. A company spokesman said regulatory filings are being prepared.