Shares of Jindal Steel & Power surged over 23 percent as it won Gare Palma IV/2 &3 at Rs 108 per tonnes in the ongoing coal e-auction. Jindal power submitted three bids for this coal block and has won at the lowest price compared to Rs 712 per tonne and Rs 1110 per tonne for the power sector.
K Rajagopal, Group CFO & Director of the company, in an interview to CNBC-TV18, said current mining capacity of Gare Palma IV/2 & 3 is at 6 mtpa and JSPL can use coal from Gare Palma for other plants as well. Other Bidders for Gare Palma IV/2 & 3 were Adani and GMR.
Rakesh Arora of Macquarie Securities has a target price of Rs 225-230 per share as the win removes big overhang for JSPL. He feels the stock has reached bottom and will improve hereon .
Meanwhile, Hindalco had won Gare Palma IV/5 for Rs 3,502 per tonne, which is the highest for the unregulated sector so far and Essar Power won the Tokisud North coal black, which was meant for the power sector as a highest price again Rs 1,110 per tonne.
The government is auctioning the coal blocks after the Supreme Court cancelled allocation of 204 mines in September last year. It has put 19 mines on block in the first tranche.The last day for the auction of mines in first tranche is 22 February.
At 13:59 hrs Jindal Steel & Power was quoting at Rs 179.00, up Rs 23.50, or 15.11 percent on the BSE.
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