Vedanta Group has received its highest domestic credit rating in over a decade after ICRA upgraded the long-term ratings of key group entities. Vedanta Limited and Vedanta Aluminium Metal Limited have been upgraded to AA+ with a Stable outlook, while Talwandi Sabo Power Limited was upgraded to AA-/Stable from A+/Watch Developing. The group’s short-term rating was reaffirmed at A1+, the highest category.

The rating action marks Vedanta’s highest domestic credit rating since 2014. The two largest businesses emerging from the demerger framework, which together account for over 75 per cent of the group’s long-term debt, have now secured AA+ ratings.

ICRA cited stronger profitability, robust operational performance, improved liquidity and enhanced financial flexibility across key businesses. It expects these trends to continue through FY27, supported by favourable commodity dynamics, better cost structures and strong earnings visibility across aluminium, zinc and oil and gas businesses.

The agency also noted Vedanta’s improved refinancing profile, supported by lower borrowing costs, proactive debt repayments and extended maturities. Average interest costs declined by around 200 basis points in FY26, strengthening debt servicing and reducing refinancing risk at the promoter level.

ICRA removed the Watch on the ratings following the demerger, effective 1 May. The restructuring is expected to create more focused and independently scalable businesses with improved capital allocation discipline and financial flexibility.

The upgrade comes amid growing interest from domestic and international banks and financial institutions in Vedanta’s refinancing plans. Global rating agencies S&P, Moody’s and Fitch have also upgraded Vedanta Resources over the past two months, reflecting stronger confidence in the group’s liquidity, financial profile and long-term growth outlook.