Vedanta Group’s subsidiary Talwandi Sabo Power Ltd. suffered a legal setback when the Supreme Court rejected its petition seeking additional compensation under “deemed export benefits.” The apex court ruled that the company was never legally eligible for these benefits. This verdict came just hours after Vedanta’s stock had opened positively at ₹451 against the previous close of ₹450.20, rising over 1% before the court’s announcement triggered a reversal.
Earlier, the National Company Law Tribunal (NCLT) had also declined approval for the demerger of Talwandi Power under Vedanta’s broader restructuring strategy. Together, the decisions have cast doubt on Vedanta’s ambitious plan to unlock value through a multi-company split.
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Regulatory Pushback and Government Objections
The Central Government has raised strong objections in NCLT, claiming Vedanta’s demerger scheme contains “serious flaws”, including inflated revenue figures and concealed liabilities. These discrepancies, according to the government, could make it difficult to recover statutory dues post-demerger.
Meanwhile, the Securities and Exchange Board of India (SEBI) has issued a “warning” to Vedanta, signaling heightened regulatory scrutiny. The twin pushback from the government and SEBI further complicates the already embattled restructuring effort.
Impact on Vedanta’s Restructuring and Market Outlook
Market analysts suggest the Talwandi litigation and regulatory hurdles could significantly delay Vedanta’s restructuring and weaken investor confidence. The group’s demerger plan, intended to create independent entities across natural resources, energy, and base metals, now faces prolonged uncertainty.
The Supreme Court’s refusal to grant relief, combined with earlier NCLT objections and SEBI’s warning, sends a strong message that Vedanta’s financial disclosures and restructuring model will face intense scrutiny. This uncertainty could impact shareholder value creation and future fund-raising capacity of Anil Agarwal-led Vedanta.