Tata Sponge shares up 4% on bourses

Shares of Tata Sponge Iron rose by 4 per cent today after the company received a Letter of Intent (LoI) from Eastern Coalfields as the successful bidder for award of 24,000 tonnes per annum of coal.
The company's scrip moved up by 3.98 per cent to settle at Rs 614.80 on BSE. Intra-day, it went up by 5.48 per cent to Rs 623.70.
On NSE, it rose by 3.63 per cent to end at Rs 613.40.
"The company is in receipt of LOI from Eastern Coalfields, a subsidiary of Coal India Ltd, declaring the company as a successful bidder for award of 24,000 TPA of coal at a notified price (winning premium is zero)," the company had said in a BSE filing on Friday.

The notified price shall be reviewed by Coal India on a half yearly basis, it added.
"As per the said LOI, the company would be required to execute the Fuel Supply Agreement, valid for a period of 5 years from date of execution to the agreement and is further extendable for another 5 years. The said agreement shall have a lock-in period of 2 years," the filing said.
Tata Sponge is a coal-based merchant sponge iron producer and operates three rotary kilns with an installed capacity of 3,90,000 tonnes per annum (TPA) to produce sponge iron.