Uncertainties surrounding Hindalco affecting its market performance

Hindalco stocks were seen to slide on Monday by as much as 6 percent in an otherwise dull trading session ending the day at INR 126.90 on the BSE, still down by 3.4 percent.

Reasons for the weak performance in the market is attributed to the uncertainty surrounding the company, with coal blocks like Dumri put on hold by the government as well as the CBI probe surrounding the Talabira-II mine controversy.

There are even reports that the CBI has filed a fresh First Information Report (FIR) against the company and has started probing into diversion of coal from Talabira-I mine.

Market experts say that whenever there is re-examination surrounding a company, it raises doubts and investors do not appreciate uncertainties and doubts. The coal issue has been highly controversial involving top-tier people in the government. Investors in the meanwhile are likely ‘wait and watch’ what the re-examination will imply.

The Hindalco scrip has shown a significant dip of 15 percent month-to-date till Friday.

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