Coal India spurts after SC ruling on coal blocks

Coal India rose 5.32% to Rs 352.35 at 14:59 IST on BSE after the Supreme Court's ruling on illegal coal blocks.

Meanwhile, the BSE Sensex was down 5.84 points, or 0.02%, to 26,769.85.

On BSE, so far 7.66 lakh shares were traded in the counter, compared with an average volume of 3.32 lakh shares in the past one quarter.

The stock hit a high of Rs 353 and a low of Rs 336 so far during the day. The stock hit a record high of Rs 423.85 on 11 June 2014. The stock hit a 52-week low of Rs 236.03 on 27 November 2013.

The stock had underperformed the market over the past one month till 23 September 2014, falling 6.37% compared with 1.35% rise in the Sensex. The scrip had also underperformed the market in past one quarter, falling 13.75% as against Sensex's 6.97% rise.

The large-cap company has an equity capital of Rs 6316.36 crore. Face value per share is Rs 10.

In a landmark decision, the Supreme Court on Wednesday, 24 September 20014, scrapped 214 of the coal blocks allocated between 1993 and 2010, sparing only 4.

According to reports, the 4 coal blocks that were spared are government-run, non joint ventures. Two of the exempted coal blocks are in Madhya Pradesh and two in Jharkhand.

The cancellation, however, will take effect after six months. The court gave some time for the central government and the coal block allottees to manage their affairs.

The 42 blocks would till then be managed by Coal India. The companies running these blocks also have to compensate the govt by paying Rs 295 per metric tonne, reports said.

The court reportedly said the blocks have to go as the allotments were illegal and arbitrary.

The government's top lawyer, attorney general Mukul Rohatgi, had reportedly told the court earlier this month that if all blocks are cancelled, state giant Coal India be allowed to take over active mines, or companies be allowed to continue production until the blocks are re-auctioned, in order to avoid supply disruptions.

Coal India's consolidated net profit rose 8.1% to Rs 4033.28 crore on 7% rise in total income to Rs 1995.83 crore in Q1 June 2014 over Q1 June 2013.

Coal India is the largest coal producer in the world.

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