Synopsis:
Vedanta is in focus after the Indian administration declined to extend the contract of the CB-OS/2 oil and gas block in the Cambay Basin, Gujarat. The block, which was getting daily 3400 barrels of oil and 3.4 lakh cubic meters of gas, has been given to ONGC for the time being. However, Vedanta is in dialogue with the government to seek a necessary solution for this denial.
The shares of this leading mining conglomerate are in focus after it failed to get the necessary approval extension for one of its core projects in its energy division. In this article, we will dive more into the details.
With a market capitalization of Rs 1,77,884 crore, the shares of Vedanta Ltd. made a day’s low of Rs 453.05 per share, down 1 percent from its previous day’s closing price of Rs 457.25 per share. Over the past five years, the stock has delivered a return of 232 percent, outperforming NIFTY 50’s return of 127 percent.
About the news
Vedanta is in focus as the Indian government has refused to renew its contract for the CB-OS/2 offshore oil and gas block in the Cambay Basin, Gujarat. This block, in which Vedanta held a 40 percent stake, was operated under a Production Sharing Contract (PSC). Besides Vedanta, the partners were the state-owned Oil and Natural Gas Corporation (ONGC) with 50 percent and Invenire Energy with the remaining 10 percent.
The PSC for this block had expired in June 2023; however, the partners carried on the work while awaiting a decision from the government. But, in September 2025, the government wrote to them that no extension would be given. It is with this that the administration of the block is being handed over to ONGC temporarily.
The CB-OS/2 block includes the Lakshmi and Gauri fields, which currently produces around 3,400 barrels of oil and 3.4 lakh standard cubic meters of gas per day. Five years back, these fields’ total reserves were estimated at around 13.6 million barrels.
However, the company, through a stock exchange filing, announced that they are engaging with the respective authorities and evaluating all resources available to resolve this problem.
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Financial Highlights
The company’s revenue for Q1 FY26 came in at Rs 37,824 crore, up by 6 percent from Rs 35,764 crore in the same quarter last year. However, on a sequential basis, revenue declined by 6.5 percent from Rs 40,455 crore in Q4 FY25.
Coming to its profitability, the company reported a net profit decline of 13 percent to Rs 4,457 crore in Q1 FY26 as compared to Rs 5,095 crore in Q1 FY25. Additionally, on a QoQ basis, it recorded a decline of 10 percent from Rs 4,961 crore.
The company has delivered an excellent ROE and ROCE of 38.48 percent and 25.26 percent respectively, and is currently trading at a very low P/E of 13.29x as compared to its industry average of 49.75x.
Written by Satyajeet Mukherjee
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