Shares of mining giant Vedanta continued their impressive climb on Wednesday, January 14. The stock surged 6.6% to reach a fresh all-time high of ₹679.45 per share. This marked the fourth consecutive trading session of gains, bringing the total four-day increase to 13%.
Metal Stocks Rally on Global Developments
Vedanta was not alone in its ascent. Other key metal stocks also traded higher. The rally in both base metals and precious metals remained firm. Several global events contributed to this positive sentiment.
The prospect of a criminal indictment against Federal Reserve Chair Jerome Powell revived worries about the central bank's independence. Meanwhile, former President Trump's capture of Venezuela's leader and his renewed threats regarding Greenland added to geopolitical tensions. Violent protests in Iran further supported the upward movement in metal prices.
These developments helped keep broader metal stocks elevated. This occurred even as frontline indices in the market faced some pressure.
Nuvama Raises Vedanta Share Price Target
The sustained rally in base metals lifted market sentiment significantly. It also prompted domestic brokerage firm Nuvama Institutional Equities to revise its outlook on Vedanta.
In its latest report, the brokerage upgraded its target price for Vedanta shares to ₹806. This is a substantial increase from the previous target of ₹686. The new target implies a potential upside of 26.5% from the stock's closing price on Tuesday.
Factors Behind the Revised Target
Nuvama cited several key factors for this optimistic revision. Rising base metal prices played a major role. The brokerage also factored in value unlocking from Vedanta's ongoing demerger process. It raised valuation multiples across various business segments to account for this.
By incorporating higher commodity prices and making volume adjustments, Nuvama collectively lifted its target price to ₹806.
Upgraded Estimates for Key Metals
The sustained rally in London Metal Exchange prices for aluminium, zinc, and silver led Nuvama to upgrade its financial estimates. The brokerage raised its EBITDA forecasts for fiscal years 2027 and 2028 by 17% and 8%, respectively. This adjustment factors in the expectation of higher commodity prices.
As a result, Nuvama expects Vedanta's EBITDA to grow at a compound annual growth rate of 20% over the FY25 to FY28 period.
Historically, from FY16 to FY26, average prices stood at specific levels. LME aluminium averaged USD 2,170 per ton. Zinc averaged USD 2,754 per ton. Silver averaged USD 22.7 per ounce.
Nuvama now anticipates a global deficit in aluminium, zinc, and silver in calendar year 2026. Consequently, the brokerage expects prices to remain well above these historical averages.
Here are the new price projections:
- Aluminium: FY27E: USD 3,000; FY28E: USD 2,750 (up from earlier USD 2,700)
- Zinc: FY27E: USD 3,000; FY28E: USD 2,900 (up from earlier USD 2,850)
- Silver: FY27E: USD 60 per ounce; FY28E: USD 55 per ounce (up from earlier USD 40 per ounce)
Additional Drivers for Growth
Beyond higher commodity prices, Nuvama identified other factors that should support Vedanta's performance. Cost reductions in the aluminium segment are expected. Volume growth in international zinc operations is anticipated. Improved power performance is also projected to contribute.
These elements are expected to help Vedanta's EBITDA grow at a 20% CAGR over FY25 to FY28E, reaching ₹724 billion.
Strong Performance in Early 2026
Vedanta's share price has demonstrated remarkable strength. After delivering a bumper 36% return to shareholders in 2025, the stock has extended its winning streak into 2026.
In the first ten trading sessions of 2026, Vedanta shares rallied another 12%. This recent performance adds to an already impressive track record. The stock has jumped 111% over the past three years. Over a five-year period, it has rallied a staggering 275%.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
