Jindal Steel & Power lost 8.2% to Rs 135.95 at 12:02 IST on BSE, after the CBI registered a fresh case of alleged cheating and corruption against the company in connection with its probe into coal blocks allocation.
Meanwhile, the BSE Sensex was up 391.49 points, or 1.5%, to 26,500.02
On BSE, so far 19.36 lakh shares were traded in the counter, compared with an average volume of 6.46 lakh shares in the past one quarter.
The stock hit a 52-week low of Rs 128 in intraday trade today, 20 October 2014. The stock hit an intraday high of Rs 145 so far during the day. The stock hit a 52-week high of Rs 350 on 9 June 2014.
The stock had underperformed the market over the past one month till 17 October 2014, falling 30.63% compared with Sensex's 1.96% fall. The scrip had also underperformed the market in past one quarter, sliding 50.66% as against Sensex's 2.14% rise.
The large-cap company has an equity capital of Rs 91.49 crore. Face value per share is Re 1.
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The Central Bureau of Investigation (CBI) on 19 October 2014 registered a fresh case of alleged cheating and corruption against Jindal Steel and Power (JSPL) among others in connection with its probe into coal blocks allocation.
The CBI alleged that 'Gare Palma IV/1' coal block was allocated to JSPL for its sponge iron plant (SIP). It was alleged that JSPL proposed and entered into irregular mining lease covering area much beyond the coordinates stipulated by Ministry of Coal, resorted to excess coal mining, irregular regularization of area beyond coordinates and excess coal mined, sale of raw coal, sale of coal fines and middling to other than specified end users, irregular permission for consumption of coal in expansion of kilns and other related allegations. Searches have been conducted on 19 October 2014 at four locations in Raigarh District, Chhattisgarh which led a recovery of incriminating documents. Further investigation is in progress, the CBI said.
Shares of Jindal Steel & Power (JSPL) have been on sustained downtrend, sliding 53.79% since its close of Rs 294.25 on 22 August 2014. The fall was triggered by the Supreme Court on 25 August 2014 terming the method of allotment of coal blocks since 1993 as illegal. A bench headed by Chief Justice R M Lodha had held that all coal blocks allocations since 1993 by various regimes at the Centre have been made illegally and arbitrarily. However, it had stopped short of cancelling them saying, what the consequences will be is the issue which remains to be tackled.
The Supreme Court in its verdict announced on 24 September 2014 scrapped 214 out of 218 coal blocks allocated between 1993 and 2010 it had already declared illegal due to irregularities in the allocation of the blocks. The four coal blocks which are exempt from the verdict are run by the Central government with no joint venture with the private sector.
However, the Supreme Court in its final verdict has given six months' breathing time for the operational blocks to wind up operations. As per the order, allottees will have to pay a fine of Rs 295 per tonne from the time the coal was mined.
As per reports, JSPL is the biggest loser of the Supreme Court verdict as it will have to part with Gare Palama 1, 2 and 3 blocks, which produce 12 million tonne per annum (mtpa) of coal. Also JSPL will have to fork out Rs 3000 crore as fine on cancelled blocks, the report indicated. The company is also likely to a post a sharp decline in profitability post 2014-15 as it would have to substitute captive coal with imported coal which is about four times more expensive, reports indicated.
JSPL's consolidated net profit fell 15.4% to Rs 418.13 crore on 10.3% increase in total income to Rs 5068.79 crore in Q1 June 2014 over Q1 June 2013.
JSPL is one of India's major steel producers with a significant presence in sectors like mining, power generation and infrastructure.
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