Vedanta turns volatile on buzz Madras HC rejects plea to reopen Tuticorin plant

The media reported that the Madras high court on Tuesday rejected Vedanta's plea to reopen Sterlite Copper plant in Tuticorin.

Shares of Vedanta were down 1.37% at Rs 126.20. It recovered after tumbling as much as 6.06% to hit the day's low at Rs 120.20.

The media reported that the Madras high court on Tuesday rejected Vedanta Resources Plc's petition to challenge the March 2018 closure order by the Tamil Nadu government of Sterlite Copper smelter plant in Tuticorin, about 610 km from Chennai, in March 2018.

The petition was reportedly moved by the company in February last year, after the Supreme Court granted Vedanta liberty to move the High Court in this regard. While pronouncing the judgment this morning, the Court reportedly informed that the verdict would have been out by 12 March, if it were not for the COVID-19 pandemic.

As per reports, Vedanta's Sterlite copper plant in Thoothukudi was shut down by the Tamil Nadu State Pollution Control Board (TNPCB) in 2018, citing violations of environmental laws. The closure order was passed immediately after the plant had turned into a protest site, with citizens opposing the expansion of the plant. The order was supported by the State government, which endorsed the same within a week.

In February 2019, the Supreme Court set aside a December 2018 National Green Tribunal (NGT) order that had allowed the reopening of the Sterlite plant. However, the order was set aside on the ground that the NGT did not have the jurisdiction to entertain the case. Therefore, Vedanta was allowed to move the High Court against the orders passed against it, leading to the present plea, reports added.

Vedanta is a diversified natural resources player, with a significant presence in zinc, oil and gas, copper, aluminium, iron ore, and power.

On a consolidated basis, the company reported a net loss of Rs 12,521 crore in Q4 March 2020 as against net profit of Rs 2,615 crore in Q4 March 2019. The profit was impacted by exceptional loss of Rs 17,132 crore in Q4 FY20 due to impairment of assets at oil & gas, copper and iron ore business.

Revenue from operations declined 16% to Rs 19,513 crore in Q4 March 2020 from Rs 23,092 crore in Q4 March 2019. Revenue fell due to lower commodity prices further impacted by COVID-19, lower volumes at zinc, oil & gas, steel business and lower power sales at TSPL partially offset by higher volume at aluminium and iron ore business, and rupee depreciation.

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