It's the end of the road for one of India's largest copper smelters.
One week after the protests against the Thailoukudi plant in Tamil Nadu had become bloody, the state government ordered that the plant be shut down on May 28. The smelting plant was operated by Sterlite Copper, a subsidiary of the British company Vedanta Resources.
While the closure is a victory for the locals – 13 protesters have toppled the police in May – which they have been demanding for nearly two decades, this puts Vedanta, which holds a 36% market share in the Indian copper industry, a stroke to.
The closure could cost $ 200 to $ 250 million from the company's pre-tax profit Vishal Kulkarni, an analyst at S & P Global, drops ratings, Bloomberg said
The London-listed company operates several metals and mining assets in India , It is India's largest zinc mine, with facilities in Rajasthan, operates iron ore mines in Goa and Karnataka, owns aluminum plants in Odisha and Chhattisgarh, has an oil field game after the merger with Cairn Oil & Gas in 201
Vedanta started 1976 as a small metal scrap business of the now billionaire Anil Agarwal and eventually developed into a metal and mining giant with branches throughout India, Zambia, Namibia and South Africa, Sri Lanka, Australia, Ireland and Liberia. Agarwal intends to become the world's second or third largest resource company by investing around $ 8 billion over the next two and a half years. Agarwal also has interests in large global mining companies, including Anglo American.
Amidst this growth, Vedanta's units have experienced some difficult times in India, including Odisha's Niyamgiri Hills, where locals protested, and their plans to reduce bauxite tribal land
Recently, in February of this year, India's Supreme Court lifted mining permits in Goa, where Vedanta is the largest iron ore miner. The revocation followed his mining license, along with those of other mining companies challenged by an environmental group. The company could reach at least $ 600 million. Then, at the beginning of May, the National Companies Laws Appellate Tribunal upheld Vedanta's plans to acquire Electrostahl Steel, breaking plans for a larger presence in the steel sector.
Last, on May 25, Vedanta was confronted with Flak, the British opposition Labor Party, which demanded the delisting of the company from the LSE after the Thoothukudi violence. This is what John McDonnell MP, Labor's Chancellor, had to say:
This is a large multinational that has been operating illegal mining corporations for years, destroying the environment and forcibly displacing local people … Following the massacre of protesters Week, regulators must now take action. Vedanta must be immediately delisted from the London Stock Exchange to remove its mantle of integrity, restore confidence in the leadership of the stock exchange, and prevent further damage to London's financial markets by this rogue company.
Despite the difficulties, Vedanta has no intention of ending and instead seeking a legal solution, said P Ramnath, CEO of Sterlite Copper, The Hindu newspaper.
Agarwal himself seems to be unshaken. The company is ready to scrutinize, he told The Economic Times newspaper, adding that the incidents are a result of false activism and dissemination of misinformation by interest groups.