Coal India drops after CCI orders
Coal India lost 0.83% at Rs 352.80 at 9:16 IST on BSE after the Ministry of Corporate Affairs said that CCI has issued two separate orders against the company and its subsidiaries for abusing their dominant position.
Meanwhile, the S&P BSE Sensex was up 75.14 points or 0.28% at 26,828.04.
On BSE, so far 16,000 shares were traded in the counter as against average daily volume of 2.54 lakh shares in the past two weeks.
The stock hit a high of Rs 354 and a low of Rs 348 so far during the day.
The Ministry of Corporate Affairs after trading hours yesterday, 27 October 2014, said that Competition Commission of India (CCI) has issued two separate orders against the company and its subsidiaries for abusing their dominant position. In one of the cases, the CCI inter alia found that the buyer of coal from CIL and its subsidiaries is saddled with penalty by way of forfeiture of Earnest Money Deposit (EMD) for non-lifting of coal after successful participation in the e-Auction without any corresponding liability upon CIL and its subsidiaries for failure to deliver coal in respect of accepted bids. Apart from issuing a cease and desist order, the CCI has ordered modification of the terms and conditions of the scheme suitably. In another case, the CCI held that CIL and its subsidiaries operate independently of market forces and enjoy undisputed dominance in the relevant market of production and supply of non-coking coal to the thermal power producers in India. The CCI inter alia found that CIL and its subsidiaries were imposing unfair conditions in fuel supply Agreements (FSAs) with the power producers for supply of non-coking coal. In both these cases, the CCI has not imposed any monetary penalty on CIL.
Coal India’s consolidated net profit rose 8.1% to Rs 4033.28 crore on 7% rise in total income to Rs 1995.83 crore in Q1 June 2014 over Q1 June 2013.
Coal India is the largest coal producer in the world.