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Steel companies’ stocks gain as SC lifts mining ban

Mumbai, Sep 3 () : Steel companies’ shares in Sesa Goa, JSW Steel, Kalyani Steel and mining corporation NMDC gained by 2 % after the Supreme Court lifted mining ban on 18 companies in Karnataka.

Sesa Goa shares was the top gainer in Nifty since it owns iron-ore mines in Chitradurga region of Karnataka. It traded with 2.7 per cent gains. JSW Steel shares gained over 1 per cent since the company gets 70 per cent of iron-ore from Karnataka mines.

NMDC total production in Bellary mines production was 5 MT. After the SC verdict, its shares traded with over 1.6 per cent gains.

Kalyani Steel gets 0.5 MT of iron ore from Bellary. Its shares shot up 1.2 per cent. Kalyani Steel MD R K Goyal said the mines will not start immediately and it may take a minimum of one month to one year depending on the environmental approvals. Now mines will provide iron ore at competitive prices and steel firms will benefit. Higher utilization and iron ore costs would come down for JSW Steel and Kalyani.

Earlier, the Centrally Empowered Committee which had probed the Karnataka mines recommended 21 companies in Karnataka for resuming mining activities. The Supreme Court on Friday had indicated that category A mines in Karnataka’s Bellary, Chitradurga and Timkur districts may be permitted resumption of iron ore mining. These mines have complied with all statutory forest and environmental clearances. Those mines who are either not indulging in any illegality or had committed negligible illegalities in their mining operations are classified A category.

Central Empowered Committee (CEC) investigations found environmental damage brought about by rampant illegal mining. The Supreme court enforced a ban on mining in Karnataka since August 2011.

After a series of hearings, in April CEC’s recommendations that some mines deemed legal be allowed to restart following reclamation and rehabilitation was accepted by the court and 30 MT a year was the output limit set for Karnataka.