Vedanta to Divest Up to 1.6% Stake in Hindustan Zinc Through Offer for Sale
Vedanta Limited has announced that it will divest a portion of its equity holding in Hindustan Zinc Limited through the Offer for Sale (OFS) mechanism. The decision to undertake the stake sale was approved by the company’s authorised committee on January 27, 2026.
Structure and Size of the OFS
Under this transaction, Vedanta proposes to sell up to 1.6% of its equity stake in Hindustan Zinc, equivalent to nearly 6.7 crore equity shares. The sale will be conducted through the stock exchange platform in a transparent and time-bound manner.
The floor price has been fixed at ₹685 per share, which represents the minimum bid price for the OFS. At this price, Vedanta is expected to mobilise approximately ₹4,500–₹4,600 crore from the stake sale. The final amount raised will depend on demand and the price at which the shares are discovered during the OFS process.
Timeline of the Offer
The OFS will be carried out over two consecutive trading sessions:
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January 28, 2026 – Bidding will be open for non-retail investors, including institutional participants.
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January 29, 2026 – The offer will be opened for retail investors.
This staggered structure is standard for OFS transactions and ensures orderly participation from different categories of investors.
Impact on Shareholding Pattern
Prior to the OFS, Vedanta holds approximately 61.8% stake in Hindustan Zinc. Upon completion of the stake sale, Vedanta’s shareholding is expected to reduce marginally to around 60.2%. Despite the reduction, Vedanta will continue to remain the majority shareholder in the company.
The Government of India continues to hold a significant minority stake in Hindustan Zinc.
Objective of the Stake Sale
The OFS is being undertaken to raise funds at the promoter level. Since the shares being sold are existing shares held by Vedanta, Hindustan Zinc will not receive any proceeds from the transaction.
Such promoter-level stake sales are typically used to enhance liquidity, manage capital requirements, or meet financial obligations without altering the capital structure of the operating company.
Understanding the Offer for Sale (OFS) Mechanism
An Offer for Sale (OFS) is a method that allows promoters or large shareholders of a listed company to sell their existing shares directly through the stock exchange. Key characteristics of an OFS include:
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It is open to institutional as well as retail investors.
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A floor price is announced prior to the opening of the offer.
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The transaction is completed within a short time frame, usually one or two trading days.
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No new shares are issued, and therefore there is no dilution at the company level.
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The proceeds are received by the selling shareholder and not by the company.
OFS is widely used for stake dilution, regulatory compliance, or capital mobilisation by existing shareholders.
Hindustan Zinc is one of India’s largest producers of zinc, lead, and silver. The company is listed on Indian stock exchanges and has a diversified shareholder base comprising promoters, the government, institutional investors, and retail shareholders.
Vedanta’s proposed stake sale represents a small portion of its overall holding and does not involve any change in the operational structure or management of Hindustan Zinc.
Vedanta’s proposed OFS of up to 1.6% stake in Hindustan Zinc, scheduled for January 28 and January 29, 2026, is a promoter-level transaction aimed at raising funds through the sale of existing shares. The transaction will result in a marginal reduction in Vedanta’s shareholding while maintaining its position as the majority shareholder.
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