Cairn India hits file excessive on BSE amid stake sale talks

May 16, 2024 | blog

MUMBAI: Shares of Cairn India Ltd on Friday climbed over 5 per cent to hit a file excessive of Rs 358 on the BSE amid stories that Vedanta Resources is in talks to purchase a majority stake within the subsidiary of UK-based Cairn Energy.

The scrip, which was flat for a lot of the session, shot up within the remaining hour of commerce on the Bombay Stock Exchange to settle with a web achieve of 4.36 per cent at Rs 355.45.

Analysts stated the inventory zoomed on stories that Vedanta is in talks to purchase a 51 per cent stake in Cairn India from its father or mother agency, Cairn Energy, which holds a 62.4 per cent stake. The deal measurement is estimated to be between USD 8-8.5 billion.

“The deal is positive for the stock, as even the lower- end of the deal ($8 billion) will value Cairn India at USD 15.7 billion compared to the current market cap of $14.4 billion,” Elara Securities analyst Alok Deshpande stated.

“In the short term, we expect the stock to rally towards the deal valuation upon the official announcement, which is expected on August 16, according to media reports,” he added.Cairn India’s father or mother firm, Cairn Energy Plc, additionally zoomed practically 2 per cent on the London Stock Exchange and was being quoted at 4.61 kilos in late afternoon commerce.In distinction, NRI billionaire Anil Agarwal-led Vedanta Resources Plc plunged by 5.5 per cent to twenty.61 kilos on the LSE.In addition, Sterlite Industries, a Vedanta Group agency, sank by over 4 per cent to shut at Rs 160.70 on the Bombay Stock Exchange. Sterlite was the largest loser within the Sensex pack right this moment.

“If the deal happens, it is obvious that Vedanta is planning to be a long-term investor. In that case, we feel the deal valuation is fair, considering our expectations of a reserve upside from other Rajasthan fields in some time in the future,” Deshpande stated.

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