Lloyds Metals soars 7% on NSE debut; stock up 137% so far in 2023

Since 2021, the stock price of Lloyds Metals has skyrocketed 5,686 per cent to Rs 582.70 from level of Rs 10.07 at the end of December 2020.

Shares of Lloyds Metals and Energy hit a new high of Rs 582.70, surging 7 per cent on making its debut on the National Stock Exchange (NSE) in Monday’s intra-day trade. On the BSE, the stock hit a high of Rs 583.85 in intra-day trade today.

Thus far in the calendar year 2023, the stock of sponge iron company has zoomed 137 per cent, as compared to 8.3 per cent rise in the S&P BSE Sensex. Since 2021, it has skyrocketed 5,686 per cent from level of Rs 10.07 at the end of December 2020.

On July 13, Lloyds Metals and Energy announced that the company received listing and trading approval from NSE for listing of its 504.8 million equity shares of face value Re 1 each. And hence, w.e.f. 17th, July, 2023 the company will also be listed on the NSE, the company said.

Lloyds Metals and Energy Limited (LMEL) is the leading player in the Iron and Steel making industry, with its operations spread around Nagpur, Maharashtra. LMEL is the sole iron ore miner in the State of Maharashtra, operating at 10 Million Tonne per annum, with 270,000 Tonne Direct Reduce Iron (DRI) and 30MW Captive Power Plant (CPP); the company is all set to be one of the most efficient steel makers going ahead.

The company was awarded a lease for iron ore mines in 2007 at Surjagarh Village, Gadchiroli district (having Maharashtra’s richest iron ore reserve), initially for a period of 20 years which was later extended to a total period of 50 years under MMDR Act, 2018.

Due to instability in the region, the company’s mines faced various challenges in operations. In May, 2021, the company entered into a strategic partnership with the largest Mine Developer & Operator of the Country (MDO), Thriveni Earthmovers Private Limited (now a Co-promoter). Thriveni Earthmovers Private Limited, with all its expertise from September, 2021 recommends mining operations at the mines site in full capacity.

With this mine, the company strengthened its backward integration process for its sponge iron production. The company has also been selling iron ore on merchant basis. The company envisages in maximising the utilization of iron ore reserves. The company’s iron ore reserves are high-quality iron ore with very low Silica and Alumina content, making it an ideal choice for its captive consumption as well as other sponge and steel makers.

Preliminary reports suggest reserves of 180+ mn tonnes. Further studies are also being undertaken to evaluate BHQ (Banded Hematite Quartz) quantities. Reserves of BHQ, which can be beneficiated, have an initial estimate of 550 MMT. These are preliminary studies & the final UNFCC-approved JORC report shall be issued under the aegis of Tata Steel Industrial Consulting Ltd soon after their detailed study, which is expected by H1FY24.

The company is optimistic about holistic utilization of its iron ore reserves and utilising its each reserves over the stipulated period of its mining life. Thus the company has charted its growth plan in forward integrating into steel making justifying the optimum utilisation of its iron ore reserves, LMEL said in its FY23 annual report.