Mumbai, January 27: The Board of Directors of Vedanta Limited (NSE: VEDL) has officially approved the sale of up to a 1.59% stake in its subsidiary, Hindustan Zinc Limited (HZL) (NSE: HINDZINC), through an Offer for Sale (OFS). This decision, announced on Tuesday, January 27, involves offloading approximately 6.73 crore equity shares.

The move comes at a time when Hindustan Zinc (NSE: HINDZINC) shares have witnessed a significant rally, hitting record highs on the Indian bourses. Following the announcement, market analysts are closely watching the floor price for the OFS, which is expected to be finalised in the coming days. SBI Share Price Today, January 27: Stocks of State Bank of India Open in Green in Early Trade, Check Latest Price on NSE.

Why Is Vedanta Selling Stakes?

The primary objective behind Vedanta’s decision to offload its stake in Hindustan Zinc is to reduce its massive debt burden and strengthen its balance sheet. By capitalising on the recent "sharp rally" in metal stocks, the mining conglomerate aims to unlock value and generate significant liquidity to meet its upcoming financial obligations.

This strategic deleveraging is part of a broader plan to streamline the group's capital structure and improve its credit profile, especially as the company navigates a complex demerger process of its various business verticals. Stock Market Holidays February 2026: Full List and Holiday Dates.

Market Impact and Financial Health

Vedanta currently holds a 64.92% stake in Hindustan Zinc, and even after this 1.59% divestment, it will remain the majority promoter. Investors are viewing this move as a pragmatic step toward financial discipline, though it may cause short-term volatility in HZL’s stock price as the market absorbs the additional equity. Furthermore, the Government of India, which holds a 29.54% stake in HZL, is also reportedly considering a similar stake sale, making the timing of Vedanta’s OFS critical for maintaining market stability.

The stake sale comes amidst a bullish cycle for the industrial metals sector, driven by rising global demand and supply chain constraints. Hindustan Zinc, one of the world's largest integrated producers of zinc, lead, and silver, has benefited immensely from high commodity prices. By selling a portion of its holdings now, Vedanta is effectively "selling into strength," ensuring it captures the maximum possible premium for its shares to facilitate its debt repayment roadmap.

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(The above story first appeared on LatestLY on Jan 27, 2026 09:06 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).