Shares of Anil Agarwal-owned Vedanta Ltd. have taken a sharp hit on the stock market, falling more than 18% in just three sessions, causing concern among investors and analysts alike. This sudden drop has been triggered by a combination of weak global cues, a delay in the company’s much-anticipated demerger, and technical weaknesses on the charts.

Stock Performance Overview

On Monday, April 7, Vedanta shares declined by another 7%, following a 9% drop on Friday and 4% on Thursday. This cumulative fall of over 18% in three sessions marks one of the steepest short-term corrections for the stock in recent times.

With this drop, Vedanta has now corrected nearly 30% from its 52-week high of ₹526. However, despite this decline, the stock is still trading 15% above its 52-week low of ₹317. As of the last trade, the stock was priced at ₹379, erasing all gains made in 2025 and is now down 15% year-to-date.

Technical Indicators Turn Bearish

The recent fall has also triggered technical red flags:

• Vedanta has broken below its key 50, 100, and 200-day moving averages, indicating a strong downward trend.

• Its Relative Strength Index (RSI) has slipped to 26, signaling that the stock has entered oversold territory. An RSI below 30 is typically interpreted as a sign that the stock may be due for a technical bounce or consolidation, but it also reflects deep selling pressure.

Demerger Delayed to September 2025

One of the key fundamental developments affecting investor sentiment is the delay in Vedanta’s proposed demerger plan. Initially expected earlier, the demerger is now pushed to September 2025, as the company cited pending regulatory approvals as the reason for the extension.

The restructuring aims to split Vedanta into five separate listed entities, each focusing on different business segments such as aluminium, oil and gas, power, base metals, and steel. For every share held in Vedanta Ltd, shareholders are expected to receive one share each of the newly listed entities.

While the demerger is expected to unlock value and bring transparency to the business structure, the delay has disappointed investors and raised uncertainty over the execution timeline.

Global Cues Drag Metal Stocks

Vedanta's fall is also reflective of a broader weakness in the metal sector. Global metal stocks have been under pressure as recession fears in the United States continue to mount. Ironically, this is happening despite a correction in the US dollar, which generally supports commodity prices and the valuations of metal companies.

However, in this case, investor risk-off sentiment has trumped the dollar weakness, leading to a sell-off in metal-related stocks, including Vedanta.

Erosion of 2025 Gains

The sharp correction has wiped out all the gains Vedanta made in 2025. The stock, which showed signs of recovery earlier in the year, is now trading lower by 15% year-to-date. This puts it among the worst-performing large-cap stocks in the metals and mining sector.

Investor Sentiment and Market Reaction

Market participants are concerned about increased volatility, not just because of the demerger delay, but also due to macroeconomic headwinds and uncertainty over global demand for metals. Analysts note that institutional investors may stay cautious, especially until there’s more clarity on the execution of the demerger and stability in global economic indicators.

What Should Investors Do?

For retail investors and traders, the stock’s current technical and fundamental condition is precarious:

• On one hand, oversold technical levels such as RSI might suggest a short-term bounce, especially if broader markets recover.

• On the other, breaking below major moving averages and uncertainty surrounding the demerger could lead to continued selling pressure in the medium term.

Many analysts are advising caution and recommending a wait-and-watch approach until the stock stabilizes and more positive cues emerge either from the company or macro environment.

Outlook Ahead

Despite the current sell-off, Vedanta continues to be a fundamentally significant player in India's mining and metals space. The demerger, if executed efficiently, could still provide long-term value. However, the delay, combined with current market weakness, has led to a reevaluation of near-term growth expectations.

Vedanta will now have to work on restoring investor confidence by offering clear timelines, regulatory updates, and perhaps interim performance improvements to offset the drag caused by the postponement.

In conclusion, Vedanta’s recent stock plunge reflects not just company-specific developments like the demerger delay, but also sectoral and macroeconomic weaknesses. Investors would do well to keep an eye on both technical indicators and corporate announcements for any signs of turnaround.

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