Shares of metals and mining company Vedanta fell 6% in early trade on September 16 after the company clarified that the proposed semiconductor business is not under its umbrella and will be underwritten by its ultimate holding company, Volcan Investments. At 10 am, Vedanta shares were trading below Rs 295 on the NSE.

After the exchanges sought clarification on the report of the Vedanta-Foxconn JV chip plant in Gujarat, the company said: “We reiterate that the proposed business of manufacturing semiconductors is not under Vedanta Limited and we understand that this will be done by the last holding company of Vedanta Limited, Volcan Investment Limited.”

Notably, Volcan Investments is a holding company owned by the Agarwal Family Trust. It is also a major shareholder in London-based Vedanta Resources Plc, which owns more than 50% of Vedanta India. Unlike Vedanta India, however, Volcan Investments is not listed. Analysts said the speculative rally in the stock over the past two days will now stop.

“It should be remembered that Vedanta is a large group with various entities. Trying to speculate and grab a position does not help. The value of any business should be assessed incrementally. First, confirm whether the business is part of the entity. Next, OminiScience Capital CEO and Investment Strategist Dr Vikas Gupta said: “Whether it matters or could become important in revenue and profit.

Meanwhile, Religare Broking placed call options on the stock with a target price of Rs 235.