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Sesa Goa `not aware' of heavy buying into scrip

Our Bureau

MUMBAI, Dec. 11

IRON ore major Sesa Goa Ltd, whose scrip has appreciated at the Bombay Stock Exchange by 103.34 per cent since November 1, has got full clearance from the Government to use in-house technology for setting up a power project.

Over the past few weeks, the Sesa Goa stock has been active on BSE. Ending trade at Rs 40.40 on November 1, the scrip raced through Rs 79.40 on December 1 to close trade last Friday at Rs 83.95. The scrip finished trade today at Rs 82.15, having moved th rough Rs 87 earlier in the day.

The heated activity of the recent past fuelled speculation of large-sized buying into the company. Asked today, Sesa's Company Secretary, Mr C.D. Chitnis, said there has been no intimation to the company so far of anyone having bought shares beyond the 5 per cent limit which mandatorily calls for a disclosure. Nor has Mitsui of Japan, which holds 51 per cent stake, increased its holding.

``The last of the needed approvals (for the power technology) came in roughly 10 days ago,'' a senior Sesa official said today. With the receipt of all approvals, the company is now examining options to put up a 30 MW pilot project close to its plant in Goa.

An investment of Rs 120-150 crore will be needed for the power project, the official said. It is proposed to be implemented on a build-own-operate basis, with an appropriate partner alongside. The capacity can be scaled up, as required, as the plant's de sign will be modular.

The company official said that, in this context, there have been discussions with various companies, including Reliance Industries Ltd.

Through its special purpose vehicle, Reliance Salgaocar Power Ltd, Reliance already has a 48 MW power plant up and running in Goa.

The Rs 240-crore Sesa Goa is 51 per cent owned by Mitsui of Japan, the equity being held through a UK-based group company. As per data with the Goa Mineral Ore Exporters' Association, the company is one of the biggest iron ore exporters from India, accou nting for over 3.8 million tonnes from the 16 million tonnes (15 million tonnes of Goan origin, balance sourced from nearby States) of iron ore shipped through Goa in 1999-2000.

On September 27, Sesa Kembla Coke Co Ltd, a subsidiary of Sesa Goa, officially informed in-house development of an eco-friendly technology to produce metallurgical coke. The process, of which power production can be introduced as a by-product, is complia nt with the US Clean Air Amendment Act, 1990.

Met-coke producers abroad are under pressure to make their processes environment friendly. Sensing a business opportunity, Sesa Goa had concluded an agreement on August 19 with Enron Engineering & Construction Co of US, to market its patented process in most parts of the world, including India.

It also signed up with Toyo Engineering Corp of Japan to cover some of the remaining markets. No sale of technology has happened yet, but the prospects are good, company officials said.