The Supreme Court’s decision that all coal blocks allocated during 1993 to 2010 by the government have been allocated illegally and arbitrarily, is likely to create overhang in the sector, according to a report.
“While it is difficult to quantify stock implications before the next course of action by the Supreme Court is known, we believe that the Supreme Court ruling would be an overhang on the sector in the near term,” Barclays said in a report today.
Yesterday, the apex court, which examined allocation of 218 blocks, said that “Common good and public interest have, thus, suffered heavily, as there was no fair and transparent procedure, all resulting in unfair distribution of national wealth”.
However, the court said that consequences arising from the verdict of such coal blocks would be considered after further hearing by the apex court.
For JSPL, the apex court’s ruling not only creates uncertainty on profitability from existing operational coal blocks (Gare Palma IV/I /2/3) but also on the profitability of the USD 2.6 billion investment in the Angul Steel and Power project as the associated Utkal B1 block is unlikely to be allocated now, the report said.
For Hindalco, profitability of Mahan and Aditya smelters is to a large extent dependent on allocation of associated coal blocks (Mahan and Talabira-II), the report said.
Tata Steel’s Ganeshpur (thermal coal block) and Kotre Basantpur (coking coal block) allocation could also be impacted, the report said.
The report said that though JSW Steel’s Rohne coal block was allotted in 2008, there was not much progress on this mine and hence limited stock impact to JSW Steel is expected.
World Cup Express
Prepaid Cards Now For Buying Tickets – Suresh Prabhu
Hope Political Prisoners Are Released: Masarat Alam To Nnis
Bihar Govt Has Not Given The Lands As Promised To Dalits: Bjp
" Never Objected To Hurriyat At Pak High Commission Events – Tharoor "
Vintage Design: The Montblanc Fountain Pen
The Holiday Professionals - A Chef In Portugal