Back in April, we took a look at Vedanta Limited (VEDL), an Indian natural resources company that featured a chart with a strong bounce after years of declines, suggests global investing specialist Paul Goodwin, editor of Cabot Emerging Markets Investor.

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What we saw was a sizable mining company with a history of profitability, an advantageous merger in progress and an impressive dividend. But as we followed VEDL over the next two months, the stock made no progress.

VEDL continued to languish until near the end of June, when it abruptly got a shot of caffeine and started a brisk rally that’s still going on. So we’re revisiting the story and buying a position.

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Vedanta is a big (market cap is just under $15 billion) natural resources company with global operations in mining, refining and power generation. The company is a world leader in zinc production (and associated lead and silver production) and its Q2 earnings report showed 84% year-over-year growth in mined metal output.

Global supply deficits have contributed to strengthening zinc prices.  The company is also a major miner and producer of aluminum, with a production run rate of 1.4 million tons per annum. Vedanta is also a major miner of iron ore and is the largest exporter of iron ore in India.

Vedanta is a commodities play, which means there is plenty of news risk. While the expected increase in U.S. infrastructure spending—which gave a boost to copper and aluminum price futures late last year—hasn’t materialized, resurgent demand from China has provided a major boost to metals prices.

So any discouraging news out of China could put a damper in VEDL. The continuing rapid growth of the Indian economy would be a tempering factor, however.

The stock is a relative bargain with a 14 P/E and an impressive 6.1% annual dividend yield. The stock’s jump today is probably the result of an analyst’s upgrade and the continuing appreciation in the price of its commodity holdings and products. We think it’s buyable right here.

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