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The stock of Mundra Port and Special Economic Zone hit the upper circuit limit on Wednesday and closed at Rs 554 after the Supreme Court dismissed a petition that sought stoppage of construction activity in its Special Economic Zone in Mundra. With this, Mundra would be able to go ahead with the construction activity planned for its multi-product Special Economic Zone.

On July 2, Mundra Port received a stay order from the Supreme Court against carrying any construction activity in the SEZ. This stay was in response to a public interest litigation filed by fishermen in that zone.

The villagers had alleged that the SEZ occupied land that flouted environmental regulations and that the project would affect the flora and fauna in the region.

The stay order had sent the stock of Mundra reeling down to Rs 388 on July 2 – the lowest since the stock’s listing in November 2007.

Wednesday’s announcement of the dismissal of the petition comes as a relief to the stock, as the SEZ which is currently the only port-based SEZ in the country, holds potential to contribute significantly to revenues not only in the form of lease rent but also through increased traffic to the port operations.

As the SEZ is likely to be used as a manufacturing base by industries that need port services, the zone would also aid higher traffic in the port in the long run.

With over 6,700 acres of notified SEZ land, Mundra Port seemed to have had a relatively smooth sail in acquiring the land unlike a few other land acquisitions; for one the land was allotted by the Government.

Two, the land in the region being arid and mostly unoccupied, did not face any disputes at the time of allotment.

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