The Hindu Business Line : Orissa Sponge up on steel plant plans

The Orissa Sponge stock, after having gone into hibernation for a week, spurted once again by 5 per cent on Tuesday. The buzz driving the stock since September was that the loss-making company has not only got a lifeline in the form of financial support from the Unitech promoters, but also moved ahead in operationalising its plan for a one million tonne integrated steel plant. Street talk suggests that it has obtained environmental clearance for its iron ore mines, rights for which was received a couple of years ago, in Orissa. The estimated reserves of iron ore mine is 130 million tonnes, said to be worth on a conservative basis over Rs 75,000 crore. It has also obtained coal mining lease in the State worth over Rs 10,000 crore.

Repeated queries to the company management and Unitech family did not yield any response. But, the Orissa Government sources confirmed to Business Line that the company obtained the crucial MoEF okay in September and the estimated ore reserves was in the range between 100 mt and 150 mt. IPICOL, an Orissa agency and Unitech family were the original co-promoters of the company. While IPICOL’s stake has gradually come down, Unitech family opted for an investor’s role in the past few years. However, now the family is poised again to become a co-promoter with larger financial commitment. A few new strategic investors are also being taken on board to fund the capex plan, Government sources said.

Jayanta Mallick

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