Global ratings agency Moody's said that while the repurchase cannot be treated as a distressed exchange, additional discounted note repurchases may be treated as one.
Earlier this week, the firm with businesses ranging from metals to oil said it "proposes to purchase up to USD 500 million in aggregate principal amount outstanding of bonds" on the terms and subject to the conditions in the Tender Offer Memorandum.
This is a type of auction in which the price on an item is lowered until it gets a bid.
The offer commenced on January 11 and will close on January 18.
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On Vedanta's offer, Moody's Investors Service said the tender offer on convertible bonds maturing in July 2016 is unlikely to be treated as a "distressed exchange".
However, the agency's final treatment of the offer will depend on the settlement price, which will be clear when the offer closes on January 18.
"However, a distressed exchange could materialise if the note-holder losses exceed current expectations, estimated based on current market prices."
Vedanta Resources has not indicated any further buybacks, Chaubal said, adding that "additional discounted note repurchases may be treated as a distressed exchange when viewed in combination with the current proposed transaction".
Although the offer does not affect Vedanta Resources' rating, the agency said persistent weakening in energy and metals prices since November 2015 has added to the pressure.
The offer will be conducted as a modified Dutch auction and allows the company to increase or decrease the offer amount, Moody's added.
"The tender offer will be funded from the term loan raised at Vedanta Resources Plc and the funds received through the part repayment of an inter-company loan by Vedanta Ltd," it added.
Asked if controversies like the debate on intolerance and
JNU row deter foreign investors, Agarwal said such things also happen in England and there are issues like racism in America.
"With two-third majority, the BJP-led government's intention to take the country forward is absolutely there. "They are very keen to get foreign investors. I would say that the Indian entrepreneur is the best bet for them," Agarwal said.
"They should create more Indian entrepreneurs and support the existing ones. Foreign investors, of course, are very important, but what Indian entrepreneurs can do is more. They have created telecom companies, established ports, bridges, etc. They can bring in bigger investors from outside through collaboration," he said.
"India is a democratic country and nowhere in the world democratic countries run businesses, except in India," he said referring to large presence of government through state-owned enterprises in businesses spanning hotels to mining.
In US and Europe, 80 per cent of the enterprises are board-run corporations and 20 per cent are family run businesses. "India hardly has any corporation. You have ICICI Bank, Larsen & Touubro, HDFC and ITC, just it," he said.
India, he said, is a land of entrepreneurs -- young, vibrant.
Agarwal said the current oil low price scenario is time to reflect how costs can be cut by bringing in better engineering and better products.
"And I'm very pleased and believe that if we hold this ground for a while, we will be the biggest winner because we are a long-term player. I always tell my people that everybody is going to die, but we must die last," he said when asked about impact of low oil and commodity prices on his companies.