Metal stocks meltdown

New Delhi: Shares of metal firms took a beating on Wednesday, with NMDC slumping six per cent, after the Supreme Court verdict on the mining royalty case.

The stock of NMDC slumped 6.08 per cent, Hindustan Copper tumbled 4.25 per cent, MOIL dropped 3.47 per cent, Coal India fell 3.18 per cent, National Aluminium Company declined 2.71 per cent, SAIL went lower by 2.26 per cent, Gujarat Mineral Development Corporation (1.39 per cent), Tata Steel (1.81 per cent) and Vedanta (0.63 per cent) on the BSE. The BSE metal index dropped 1.51 per cent to 30,312.05.

In a major victory for mineral-rich states, the Supreme Court on Wednesday allowed them to seek dues from April 1, 2005, on royalty and tax on mineral rights and mineral-bearing land from the Centre in a staggered period of 12 years. A nine-judge Constitution bench headed by Chief Justice of India DY Chandrachud said the argument for prospective effect of July 25 is rejected. According to Miners’ body FIMI, the Indian mining sector is already saddled with the highest taxation in the world.

“The Supreme Court’s recent ruling allowing States to recover past tax dues from April 2005, without any interest, is negative for the entire metal sector,” said Vikram Kasat, Head-Advisory, PL Capital - Prabhudas Lilladher.