Vedanta Gains 5% On Cheer From Hindustan Zinc's Dividend Income

On Wednesday, shares of Vedanta gained as much as 5.2 percent to Rs 104.40 as investors cheered the dividend payout of Rs 21.30 per share by announced by company's subsidiary Hindustan Zinc.

Shares of Hindustan Zinc also rose on the dividend payout news.

Along with its financial results for the September ended quarter, Hindustan Zinc declared an interim dividend of Rs 21.30, amounting to Rs 9000 crore. A major part of the dividend will go to Vedanta Limited which holds 64.92 percent in the company. This translates to a dividend amount of Rs 5,843 crore.

Earlier this month, Vedanta's delisting failed as per terms of delisting regulations, causing the shares to decline further. The promoters had sought to buy out 169.73 crore shares or 47.67 percent stake held by the public to delist the firm.

Shareholders of the company will now be looking forward to the dividend being passed on as per its dividend distribution policy.

Hindustan Zinc's revenue for the September ended quarter rose 25 percent year-on-year to Rs 5,660 crore primarily due to higher silver volumes and higher silver prices. Its EBITDA grew 39 percent to Rs 2950 crore on strong revenue growth and lower cost.

The results indicate that the metal cycle is improving.