The London-based company has loans worth US $2.5 billion maturing in 2015-16, of which US $2.1 billion is with the subsidiaries and the remaining US $0.4 billion is with the group firm Vedanta Resources Plc.
Minerals and mining major Vedanta is eyeing the expected low interest rates in India to refinance its short-term loans of up to US $1.6 billion (about Rs 10,200 crore) with long-term options in this fiscal ending March 2016.
The London-based company has loans worth US $2.5 billion maturing in 2015-16, of which US $2.1 billion is with the subsidiaries and the remaining US $0.4 billion is with the group firm Vedanta Resources Plc.
Vedanta Resources CFO D D Jalan has said that with Indian subsidiaries, half of the immediate total maturities of US $2.5 billion relates to short-term loans taken out in these subsidiaries at a relatively low cost to drive finance costs down in the past, when long term project loans had higher rate of interest.
"However, in today's expected lower interest rate scenario and abundant liquidity conditions in India, we would be refinancing these through a longer tenure instruments during the year in the domestic market," he said during an analysts conference call last week.
Vedanta Resources total gross debt, excluding working capital loans, stood at US $16.2 billion at the end of March 2015. Of this, subsidiaries had a debt of US $8.4 billion and the balance is in the holding company.
Separately, the Group said at its earnings release: "Of the US $2.1 billion debt maturing in subsidiaries during fiscal year 2016, almost US $1.6 billion is in the Aluminium and Power businesses.
"These maturities mainly relate to short-term loans which are expected to be refinanced from long-term sources in view of the softer interest rate regime in the Indian market."
On loans, Jalan said: "Overall, we are targeting an increase in average maturity by a year on refinancing."
The liquidity for the Group remains strong with US $8.2 billion of cash and cash equivalents, along with an additional US $1.2 billion of undrawn committed lines of credit, he told analysts and investors.
Vedanta Resources has also taken a US $350 million loan from the State Bank of India of which "US $25 million had been drawn as at March 31, 2015, to meet the upcoming debt maturities."
The London Stock Exchange-listed company had reported a consolidated net loss of US $1.8 billion in 2014-15 against a net loss of US $196 million in 2013-14 on account of one-time non-cash impairment charge of US $4.5 billion. Consolidated revenue was largely flat at US $12.9 billion for 2014-15.
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