Shares of soared over 5 per cent in early trade on Wednesday after Bank of America Corporation (BofA) upgraded the stock to buy from neutral and sharply raised its price target to ₹840 from ₹480, signalling strong upside potential from current levels.
At 10.29 am, the stock traded at day’s high of ₹731.50, up 5.2 per cent from the previous close of ₹695.10.
KEY HIGHLIGHTS
- Vedanta shares little over 5%
- BoFA updrages the stock to buy at a higher target price of ₹840 per share
- BoFA lifts EBITDA estimates for FY26 to FY28 by 16–21%
Vedanta stock movement today
The brokerage’s bullish stance is driven by an improved outlook on aluminium prices, supportive silver prices and expectations of a healthy dividend yield. BoFA Securities estimates that Vedanta could deliver a dividend yield of over 6 per cent by FY27E, enhancing the stock’s attractiveness for income-focused investors amid improving commodity fundamentals.
The upgrade also reflects growing confidence in the company’s financial stability. According to the brokerage, significant deleveraging at the parent company has reduced concerns around a potential increase in brand-fee rates or inter-corporate loans, factors that had previously weighed on investor sentiment. The improvement in the balance sheet position is seen as lowering risk and strengthening overall corporate governance visibility.
BoFA has raised its EBITDA estimates for FY26 to FY28 by 16–21 per cent, factoring in higher aluminium price forecasts, a higher fair valuation for Hindustan Zinc Ltd, depreciation in the USD-INR exchange rate and a reduced holding-company discount of 5 per cent compared with 15 per cent earlier. The lower discount assumption reflects increased confidence in the group structure and capital allocation practices.
Aluminium remains a key earnings driver for Vedanta, and expectations of firmer global prices have materially improved earnings visibility. At the same time, steady silver prices and favourable currency movements are expected to further bolster profitability across segments.