Tamil Nadu Deputy Chief Minister O Panneerselvam asserted that the government will take resolute steps for the permanent closure of Vedanta group's copper plant.
Shares of Vedanta trimmed some of its losses after falling 6 percent in the morning. Investors reacted to the news around Sterlite Copper in Tamil Nadu.
The stock touched an intraday high of Rs 250.00 and an intraday low of Rs 238.05.
Tamil Nadu Deputy Chief Minister O Panneerselvam asserted that the government will take resolute steps for the permanent closure of Vedanta group's copper plant.
"Today, the main demand of the people is that the copper plant should be permanently closed. In keeping with their demand, it is shut now. I would like to make it clear that Sterlite plant will be permanently shut," Panneerselvam said.
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The "Amma's government," will do all things necessary to ensure the plant's closure, he told reporters after visiting those injured in the violence and police firing on May 22, at a state-run hospital here.
"The government will do its duty for permanently closing down the plant," he said.
The Deputy Chief Minister said even if there were legal challenges in the closure of the plant, it will be faced and the government will take resolute steps to permanently close down the Vedanta group's copper unit here.
The stock has lost over 17 percent in the past one month, while its three-day loss stood at a little over 1 percent. At 10:09 hrs Vedanta was quoting at Rs 247.65, down Rs 5.45, or 2.15 percent, on the BSE.
Brokerage: Morgan Stanley | Rating: Overweight | Target: Rs 386
The global research firm said that closure of Sterlite plant is a negative for stock in near-term. It also sees downside risk to FY19 EBITDA and earnings.
Brokerage: HSBC
HSBC said that closure of Sterlite plant could negatively impact FY19 EBITDA By 4 percent and fair value by 6 percent. Copper smelter contributed Rs 1,370 crore Or 5 percent To consolidated FY18 EBITDA. Further, it noted that the smelter has carrying value of Rs 2,130 crore i.e. 2 percent of total assets. Closure would take out 46 percent of India's copper smelter capacity.
(With inputs from PTI)