The prolonged shutdown of Vedanta's copper smelter facility at Tuticorin in Tamil Nadu would be credit negative for the company and marginally increase leverage, Moody's Investors Service said today.
"A prolonged shutdown would be credit negative for Vedanta because of the potential loss of revenue and earnings from its copper operations in India," the rating agency said in a statement.
Last week, UK-based Vedanta Resources plc announced that the Tamil Nadu Pollution Control Board had rejected the company's application to renew its right to operate the copper smelting facility at Tuticorin.
The facility that closed for a 15-day scheduled maintenance turnaround on March 27 is still remained shut.
Vedanta owns one of the two custom copper smelters in India and, according to International Copper Association, had a
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