Sesa Goa, Sterlite plummet after Goa mining ban
11 September 2012
Shares in Sesa Goa, India's biggest iron ore exporter, and sister company Sterlite Industries today fell in Mumbai trading after a ban on mining in Goa, which accounts for more than half the nation's overseas sales of iron ore.
Sesa Goa shares fell as much as 7 per cent to Rs157.85, the biggest dip in more than six months, while Sterlite Industries which is set to be merged with Sesa Goa, fell 5.1 per cent to Rs93.50. Vedanta, the parent company, is preparing to merge Sesa Goa and Sterlite.
The ban will be effective starting today, R K Verma, principal secretary (mining) in the Goa government, said in a statement on the ministry's website, without specifying the duration. Trading and transportation of minerals that have already been mined will be allowed, the ministry said.
The move came just days after a judicial commission exposed a mining scam involving ''serious illegalities'' in the award of licences, the latest in a long line of mining scandals to have rocked the country.
''It is necessary in order to scrutinise clearances obtained by the mining lease holders and allowing continuation of mining without proper scrutiny and verification of requisite approval,'' Verma said in his order.
Karnataka's blanket mining ban, instituted last year in the wake of its own multi-billion dollar iron ore scandal, was partially lifted last week, when the Supreme Court ruled that those companies which had not broken any laws could restart production, though none have come fully online yet.