Vedanta Resources is a diversified and integrated metals and mining group with annual sales of $1.9bn. Its principal operations are located in India, where it has a major market share in each of our main metals: aluminium, copper, zinc and lead. There are also substantial copper operations in Zambia and 2 copper mines in Australia.

            Red = 25 day moving average.           Green = 200 day moving average.

                        

Copper - (6 month graph)

SALES PER ACTIVITY (Data as of 31/03/2006)

Copper:      60%
Zinc:         24%
Aluminium:  12%
Others:       4%

Onwards and upwards.

Broker Recommendations - Friday 2nd June 2006, 12:15 pm

Deutsche reiterates buy Vedanta Resources (LSE: VED.L - news) with a 16.60 target.

Merrill says buy Vedanta Resources.

Morgan Stanley has overweight on Vedanta Resources (2300p target).

Copper Futures Increase on London Metal Exchange, Erasing Earlier Decline

June 2 (Bloomberg) -- Copper rose on the London Metal Exchange, reversing an earlier decline, on speculation that supply won't keep up with increasing demand for the metal.

A shortfall in copper supplies will give an ``upward shift'' to prices in the next three to five years, Xstrata Plc's copper chief Charlie Sartain said on the sidelines of the Minerals Council of Australia 2006 Minerals Week in Canberra on May 31.

Copper for delivery in three months on the LME was $115, or 1.5 percent, higher at $7,825 a metric ton as of 10:36 a.m. local time. Copper has declined 4.9 percent this week, reducing its gain this year to 78 percent.

``It's bottomed and is heading higher over the next week,'' Peter Hollands, managing director of U.K. consulting company Bloomsbury Minerals Economics Ltd., said in a telephone interview.

BHP Billiton, the world's largest miner, on May 4 said there's likely to be a deficit of copper concentrate between 2006 and 2008. Copper concentrate is an intermediate product that is refined into metal, which is used in wires and pipes.

Supplies are been disrupted by labor disputes and equipment and worker shortages.

A strike at Grupo Mexico' SA's La Caridad mine, Mexico's second-largest copper mine, began March 24. Grupo Mexico miners walked off the job at the Cananea copper mine yesterday in a dispute with the government over recognition of a union leader. Cananea is the company's largest mine in Mexico, producing almost half of the refined copper that the company produces in Mexico.

Among other metals for delivery in three months on the LME, lead rose $20, or 1.9 percent, to $1,060 a ton. Zinc gained $95 to $3,600, nickel added $250 to $20,800 and aluminum rose $20 to $2,630. Tin was the only metal to decline, by $10, to $8,175.

Surge in commodity prices is no bubble

By: Geoff Candy Posted: '02-JUN-06 07:00' GMT Mineweb 1997-2004

JOHANNESBURG (Mineweb.com) -- The huge surge in commodities prices is no bubble, delegates at the World Economic Forum on Africa heard yesterday.

At a session entitled The Commodities Market: Riding the Bull Run, delegates heard the views of Jeffrey Currie, MD and head of commodities research at Goldman Sachs, Obiageli Katryn Ezekwesili, Minister of Solid Minerals for Nigeria and Sir Mark Moody-Stuart, Anglo Americans chairman.

What came out of the session is that commodity industry is not a bubble and, while prices are at or near record highs, miners are not producing astronomically high returns.

The primary reason is the significant rise in costs, partly because of the lack of investment across the board and, partly as a result of an increase in regulation, especially environmental regulation and the costs involved in ensuring transparency.

According to the delegates the gold price, whose fluctuations have been historically linked to currency movements diverged from this correlation in September 2005, has once again reconnected, but the equilibrium level has been moved from $300/oz to $650/oz.

The divergence was driven by: the introduction of gold exchange traded funds (ETFs), stagnating production, increased jewellery demand and speculation from central bank purchasing.

This demand for such ETFs has recently reached a plateau, which has resulted in the reconnection with currency movements.

Delegates heard that the fact that long prices have shot up more quickly than spot prices is evidence that the bubble is underpinned by buying from industry players, rather than speculative buying by funds.

An industry that in the long-term cycles between phases of investment and exploitation, the commodities industry is currently at the beginning of a new investment phase. And, it is one that could last at least a decade longer than the last one.

While investment has been surprisingly slow, this was shown to be a sign that this cycle is somewhat different to previous boom-bust type scenarios.

The investment in new mines and infrastructure currently under way is happening in an increasing cost environment without the tax subsidies that characterised the last cycle.

However, because this is a cycle albeit an extended one, the current investment will ultimately result in an excess of supply which will drive prices down.

The question on everyones lips is how long this cycle will last? And, the answer seems to lie in the question of costs.

The current spike in costs is the main reason behind industry reluctance to invest, but as production is scaled up costs could go either way and, until such uncertainty is resolved, prices will remain high.

Prices are recovering a little lets hope the carry on upwards for a change.

Dropped nearly 5.5%...what a bargain.

"Source: Dow Jones Base Metals Board

London Metal Exchange three-month copper slipped lower through the afternoon session as light but persistent selling from investors pushed prices below $7,500 a metric ton, traders said.

The sell-off was largely attributed to overnight anti-inflationary comments by U.S. Federal Reserve Chairman Ben Bernanke.

Analysts said Bernanke's hint of further interest rate hikes, combined with recent weaker-than-expected U.S. data, points to a slowdown. Until further clarity on how long a tightening period may last, base metals look set to remain volatile, they added.

LME copper hit an intraday low of $7,485/ton, down 4% on the day and a 15.2% drop on the all-time high of $8,825/ton hit May 11. The market closed the kerb session at $7,510/ton.

But in the background, an ongoing strike at Grupo Mexico's La Caridad and Cananea operations, along with still low inventories and a slow supply side response to rising demand is underpinning the market, traders said.

"Because of supply constraints and low inventories, we continue to believe downside risk to the copper price is limited, although upside pressure is also likely to ease amid a seasonally weaker period for demand ahead," said Barclays Capital.

"Importantly also, the physical copper market in China is currently very weak," Barclays Capital added.

The other base metals were far more resilient than copper, although ended the session generally lower.

LME aluminium and zinc were both down but still within their recent ranges.

Of these two metals, analysts said aluminium has the more bearish fundamentals, with the cost of its key ingredients, alumina and power, down in recent days.

In contrast zinc remains in a market deficit, with demand growth from China very strong and supply not anticipated to catch-up until 2008."



The last para' is important because vedanta gets more than half its profits from zinc.

Regarding the last posting (the last two paragraphs). Zinc has gone by more than 5% today on the spot market. As Vedanta derives half its profits from zinc the present sp must be quite cheap. The company goes into the FTSE 100 today too.

Agree HP, nothing other then a bargain at these prices. IMHO

Some famous old names have been thrown out of the FTSE 100 to be replaced by two mining groups and a power station.

Out go Cable & Wireless, the Daily Mail & General Trust and Ladbrokes, while in come mining giants Vedanta Resources and Lonmin along with energy group Drax.

The changes were widely forecast, but not officially revealed by the Financial Times controlled FTSE Group until after the stock market closed on Wednesday. All the relegated companies drop down to the FTSE 250.

Vedanta Resources PLC      13 June 2006


VEDANTA RESOURCES PLC ANNOUNCES ACQUISITION OF STERLITE GOLD LTD


Vedanta Resources plc ('Vedanta') announced today that it has entered into an
agreement to acquire a controlling interest in Sterlite Gold Ltd. (TSX: SGD)
('Sterlite Gold'), and that it plans to make a cash offer to acquire, directly
or indirectly, all of the outstanding common shares of Sterlite Gold.

Vedanta announces its intention to make a full cash offer for Sterlite Gold, a
gold mining company listed on the Toronto Stock Exchange ('TSX'), for a total
consideration of C$68.45 million (the 'Sterlite Gold Offer'), representing a
price of C$0.258 per Sterlite Gold common share. As part of this transaction,
Vedanta has entered into an agreement to acquire the entire issued share capital
of Twin Star International Limited ('TSI'), the holder of 55.0% of Sterlite
Gold's common shares, for C$37.68 million in cash (the 'TSI Acquisition'),
representing an imputed price of C$0.258 per underlying Sterlite Gold common
share.

Sterlite Gold's principal assets are located in Armenia and include an open pit
gold mine at Zod and a gold processing plant at Ararat. In October 2004,
Sterlite Gold announced measured and indicated resources estimated at 2.1
million ounces. Vedanta believes that the acquisition offers an attractive low
risk exposure to this commodity and provides the opportunity to deploy its
proven project development skills. Vedanta believes Zod has the potential to be
a world class mine, with existing development potential in addition to
exploration upside. The acquisition will also provide Vedanta with the expertise
to take advantage of other gold opportunities, particularly in India.

The board of directors of Sterlite Gold appointed a committee of independent
directors (the 'Sterlite Gold Independent Committee') to review the terms of the
proposed Sterlite Gold Offer. The Sterlite Gold Independent Committee retained
PricewaterhouseCoopers ('PwC') to prepare a valuation of the Sterlite Gold
common shares in compliance with Canadian securities laws, including Ontario
Securities Commission Rule 61-501 ('Rule 61-501'). PwC has advised the board of
directors of Sterlite Gold and the Sterlite Gold Independent Committee that the
offer price is within its valuation range of C$0.24 to C$0.275 per share. The
board of directors of Sterlite Gold, on the recommendation of the Sterlite Gold
Independent Committee, has unanimously approved the Sterlite Gold Offer and has
agreed to recommend that shareholders of Sterlite Gold tender their common
shares to the Sterlite Gold Offer.

The Sterlite Gold Offer will be subject to customary conditions including all
regulatory approvals having been obtained and acceptance by (i) at least 662/3%
of the total number of issued and outstanding Sterlite Gold common shares, and
(ii) not less than a majority of the total number of issued and outstanding
Sterlite Gold common shares, excluding any common shares that may not be
included as part of the minority approval of a second step transaction. Further
details will be contained in the takeover bid circular to be mailed to Sterlite
Gold common shareholders, which will also include a copy of the PwC valuation.

Vedanta and Sterlite Gold are under common control. Volcan Investments Limited
('Volcan') owns 53.76% of the ordinary shares of Vedanta and 100% of the shares
of TSI, the controlling shareholder of Sterlite Gold. The transactions
comprising the TSI Acquisition and the Sterlite Gold Offer therefore constitute
a related party transaction under the Listing Rules of the UK Listing Authority
and an insider bid under Canadian securities laws, including Rule 61-501.
Vedanta formed a special committee of directors who are independent of Volcan to
consider and supervise the making of the TSI Acquisition and Sterlite Gold
Offer.

Vedanta has been advised by HSBC plc, Blake, Cassels & Graydon LLP, Ernst &
Young LLP and SRK. Ernst & Young LLP has provided Vedanta with written
confirmation that the terms of the TSI Acquisition and Sterlite Gold Offer are
fair and reasonable as far as the shareholders of Vedanta are concerned.

'We are excited by this unique growth opportunity and believe the acquisition
while creating value for our shareholders will contribute significantly to the
Armenian economy.' said Mr. Kuldip Kaura, Chief Executive Officer, Vedanta. 'It
will position us well to pursue other gold opportunities including those in
India.'

Citywire. Published: 08:14 Monday 12 June 2006
By: Phil Cozens, Stockmarket Correspondent

Citigroup has a buy rating and 22 for Vedanta Resources.

Vedanta Resources PLC announced a slew of projects that is expected to enable Zambia's Konkola Copper Mines (KCM) to nearly treble its copper production.

The projects will allow KCM, in which Vedanta holds a 51 pct stake, to raise output from 2.4 mln tonnes to 6 mln tonnes thus extending its lifespan to 2035, KCM chairman Navin Agarwal said.

'The total investment in these projects is 750 million dollars. This is the single largest investment in Zambia to date,' Agarwal said.

He said KCM has awarded contracts to several international firms to develop the untapped Konkola Deep Mining Project (KDMP), as well as construct a new smelter and acid plant which will be completed in 2009.

The new smelter plant will produce 250,000 tonnes of copper while an acid plant will manufacture 1,700 tonnes of acid per day, Agarwal said.

'KCM will have created the capacity within Zambia to treat all the copper concentrate that will be produced by other stand alone copper mines, thereby enabling the country to export value added finished copper rather than exporting raw material concentrate,' Agarwal said in a statement.

KCM is Zambia's largest mining company with a work force of 10,000 workers.

Vedanta Resources is a London-listed Indian mining group which bought 51 pct stake in KCM in November 2004, two years after South African mining firm Anglo American Corporation withdrew from KCM.

Reading the piece below about Xstrata making acqusitions - how about Xstrata using its war-chest to make a bid for Vedanta ???????



Nick Fletcher
Wednesday June 28, 2006
The Guardian

Mining group Xstrata lost 51p to 19.04 on talk it could embark on a big acquisition spree if it loses out in the complicated bid battle in Canada centred on Inco and Falconbridge. If Xstrata decides to walk away, it would cash in its stake in Falconbridge which is worth around $3.8bn. "Xstrata is now effectively holding a multi-billion dollar war chest and is bound to look to consolidate further investments," said analysts at Numis. "That at least puts other miners in the merger and acquisition spotlight." It picked Antofagasta, down 6p to 400p, and Lonmin, 56p lower at 26.90, as potential takeover targets.

IMHO Vedanta is the bargain-buy of the miners at the moment.

Nick Fletcher
Wednesday June 28, 2006
The Guardian

Mining group Xstrata lost 51p to 19.04 on talk it could embark on a big acquisition spree if it loses out in the complicated bid battle in Canada centred on Inco and Falconbridge. If Xstrata decides to walk away, it would cash in its stake in Falconbridge which is worth around $3.8bn. "Xstrata is now effectively holding a multi-billion dollar war chest and is bound to look to consolidate further investments," said analysts at Numis. "That at least puts other miners in the merger and acquisition spotlight." It picked Antofagasta, down 6p to 400p, and Lonmin, 56p lower at 26.90, as potential takeover targets.


-------------------------


Ummmm - very interesting. Vedanta is worth 3.7 billion whilst Xstrata is making $3.8 billion from its stake in Falconbridge and could be on the acquisition trail.

....ummmm. -very interesting.

Nothing in this life is impossible, but I would reckon that speculation to be on the far side of much less than likely

Think this is interesting because Vedanta derives more than 50% of its income from zinc.
Dai.


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29 June 2006

Zinc price to peak in Q3, then slump; lead to just slump: SG

Source: Platts

The price of zinc will top out this quarter and then slump, but lead which saw its peak last quarter is already on a down slope that will last for the next year and a half, according to Societe Generale's latest issue of Commodities Research.

Zinc's London Metal Exchange cash price averaged $1,381/mt in 2005. In the first quarter of 2006, its price averaged $2,248 then rose to $3,300 in Q2 and is forecast to average $4,100 in Q3, but from there on it's all downhill. SG predicts a Q4 2006 price of $3,050 that will fall to $2,725 in Q1 2007, $2,450 in Q2, $2,250 in Q3 and $1,975 in Q4 for a 2007 average of $2,350/mt. The LME cash price was $3,020 Wednesday.

SG describes the market as moving from a destocking period last year that cut demand growth from 7% in 2004 to 1% in 2005 into a period of 5% growth in 2006 dropping slightly to 4.5% in 2007. Global refined zinc production is expected to increase 5-5.5% this year and then jump by 6-7% in 2007 with mine production growth more than doubling to 9% in 2007 and 2008. This increase will be due to mine restarts (Lennard Shelf), expansions (Antamina) and new mines (San Cristobal). There could be a surplus from 2008 onwards, SG suggests.

Vedanta Resources invites bids to set up India nuclear power plant - report

AFX


BOMBAY (XFN-ASIA) - London-based metals and mining group Vedanta Resources Plc has invited preliminary bids for setting up a 2,400 MW nuclear power plant in India, Business Standard reported.

It said the company has invited expressions of interest from global firms and that it plans to award the contract on a build, operate and maintain basis.

...Anyone know if this is VED's 1st Nuclear venture or not please?