THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

22 July 2016

VEDANTA LIMITED AND CAIRN INDIA REVISE TERMS FOR MERGER

Vedanta Limited, Cairn India Limited ("Cairn India") and Vedanta Resources plc ("Vedanta plc" together with its subsidiaries, the "Group"), today announce revised and final terms to the recommended merger between Vedanta Limited and Cairn India (the "Transaction"), that was announced on 14 June 2015.

Key Highlights

• The Boards of Vedanta Limited and Cairn India have today approved revised and final terms for the Transaction, taking into account prevailing market conditions and having regard to underlying commercial factors.

• Pursuant to the revised and final terms, each Cairn India minority shareholder will receive for each equity share held:

  • 1 equity share in Vedanta Limited; and

  • 4 Redeemable Preference Shares with a face value of INR 10 in Vedanta Limited, with a coupon of 7.5% and tenure of 18 months from issuance.

  • Implied premium of 20% to one month VWAP of Cairn India share price.

• The recent commodity price environment has further strengthened the strategic rationale of the Transaction outlined at the announcement:

  • Diversified Tier-I portfolio de-risks earnings volatility and drives stable cash flows through the cycle.

  • Strong historical evidence over the last 10 years, of diversified resources companies generating total shareholder returns superior to single-commodity companies.

  • Improved ability to allocate capital to the highest return projects across the portfolio.

  • Greater financial flexibility to sustain strong dividend distribution.

  • Cost savings and greater capital efficiency, with potential re-rating to benefit all shareholders.

  • Stronger balance sheet will allow for the Group's overall cost of capital to be reduced.

  • Consistent with stated corporate strategy to simplify the Group structure.

  • Offers significant long term sustainable value enhancement for all shareholders.

• The Transaction offers significant benefits for Cairn India shareholders

  • De-risked earnings and stable cash flows supporting investment and dividends through the cycle, driving long term value.

  • Attractive transaction terms.

  • Exposure to Vedanta Limited's world class metals and mining assets - low cost, long life and well invested, delivering strong growth through production ramp ups.

  • Improved optionality to allocate capital and increased participation in cost savings.

  • Increased free float and trading liquidity.

  • Potential re-rating of the merged company.

• The Jurisdictional High Courts have convened the shareholder meetings for each of Vedanta Limited and Cairn India on 8 September 2016 and 12 September 2016, respectively.

  • The Notice convening the shareholder meetings will be sent to shareholders in due course.

• As previously announced, following completion of the Transaction:

  • Vedanta plc ownership in Vedanta Limited is expected to decrease to 50.1% from its current 62.9% shareholding.

  • Cairn India minority shareholders will own 20.2% and Vedanta Limited minority shareholders will own a 29.7% stake in the enlarged entity.

Anil Agarwal, Chairman of Vedanta Resources plc, said: "I am pleased that the Boards of Cairn India and Vedanta Limited have approved the terms announced today. The simplified corporate structure will better align interests between all shareholders for the creation of long term sustainable value."

Sudhir Mathur, CFO and Acting CEO of Cairn India, said: "Cairn India shareholders will benefit from exposure to a diversified portfolio of world-class, low cost, long-life assets with significant growth. We are confident that the financial strength and diversified portfolio of Tier-I assets will provide de-risked earnings and stable cash flows, driving long-term value. Cairn India shareholders will benefit from the revised terms announced today, while retaining the upside from Cairn's strong oil & gas assets."

Tom Albanese, CEO of Vedanta Limited, said: "The strategic rationale for merging Vedanta Limited and Cairn India remains highly compelling. Diversified resources companies have delivered superior returns for shareholders historically. The Transaction consolidates our portfolio of attractive Tier-I assets and simplifies the group structure, better positioning the group to deliver superior value to all shareholders over the longer term."

Recommendations, Financial Advisers and Fairness Opinions

The non-conflicted, independent members of the Boards of Directors of Vedanta Limited, Cairn India and Vedanta plc unanimously approved the revised merger terms.

Independent valuers, Price Waterhouse & Co LLP and Walker Chandiok & Co LLP, have provided their joint recommendation on the exchange ratio for consideration by the Boards of Vedanta Limited and Cairn India.

Lazard & Co., Limited has acted as financial advisor to Vedanta Limited in relation to the Transaction and the Board of Directors of Vedanta Limited has received a fairness opinion from Lazard India Private Limited with regard to the fairness of the exchange ratio to Vedanta Limited, from a financial point of view.

The Board of Directors of Cairn India has received opinions from DSP Merrill Lynch Limited and JM Financial Institutional Securities Limited as to the fairness of the exchange ratio to Cairn India, from a financial point of view.

The appointed date for the scheme has been revised to 1 April 2016 from 1 April 2015 earlier. The Transaction is expected to close in Q1 CY2017.

Conference Calls for Analysts and Shareholders

There will be a conference call at 6.45 PM IST today:

Mumbai +91 22 3065 2322

+91 22 6181 3322

Passcode: 89897#

Contacts

Vedanta Resources plc

Ashwin Bajaj

Director - Investor Relations

Radhika Arora

Associate General Manager - Investor Relations

Ravindra Bhandari Manager - Investor Relations Tel: +44 20 7659 4732

Tel: +91 22 6646 1531

[email protected]

Vedanta Limited

Ashwin Bajaj

Director - Investor Relations Sunila Martis