Andy Mukherjee is a Bloomberg Gadfly columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.

What a difference a year makes, especially when it comes with hundreds of million of dollars in unexpected cash prizes.

At the start of 2016, Vedanta Resources Plc's 2019 dollar bonds were trading at less than 50 cents on the dollar. Now, they're well above par.

Bond Bonanza
Vedanta's 2019 dollar notes are trading at 102.8 cents on the dollar versus just 60 cents on the dollar 12 months ago
Source: Bloomberg

Founder and Chairman Anil Agarwal is celebrating by launching a debt-funded dalliance with Anglo American Plc. Both the billionaire and his bondholders should raise a toast to zinc.

Hindustan Zinc Ltd., in which Agarwal picked up a controlling stake 15 years ago from the Indian government, announced a whopping $2.1 billion dividend on Thursday, taking the total annual payout to above $4 billion.

The Indian government continues to own 29.5 percent of the zinc producer. Strip away its share, and that of other minority investors in India, and the cash getting wired to Vedanta Resources from the latest dividend still amounts to $720 million. That's enough to pay the London-based company's $508 million obligations this year to creditors and then some.

But that's still only a sliver of total group debt. As much as $3.2 billion in interest and principal comes due next year at the main company and its subsidiaries. The bigger the zinc bounty, the less difficulty the group should have in meeting its financial commitments.

Vedanta has some $20.2 billion in bonds and loans outstanding
Source: Bloomberg

After almost doubling since early last year, zinc prices are holding up. For all the talk of the metal getting muscled out by aluminum in galvanized sheets used to make cars, the market is more focused on supply disruptions, such as the strike at a mine in Quebec.

Agarwal and his bondholders aren't the only ones with reason to rejoice. The Indian government ends up a winner, too. A judicial challenge to the legality of the 2002 privatization of Hindustan Zinc meant it couldn't sell its remaining shares to the billionaire. New Delhi would be crazy to offload them at this point.

In September, shareholders of Cairn India Ltd. blessed the plan to merge with Vedanta Ltd., adding ballast to Agarwal's dream of creating a resources conglomerate to rival the likes of BHP Billiton Ltd. Now, he wants to buy $2.4 billion of Anglo American shares to help pave the way to his goal.

The bigger the tycoon's ambitions get, the keener he'll be to pump cash out of the zinc business. The Indian government just needs to sit back and collect its pound of flesh.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

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