Shares of Hindalco Industries plunged as much as 7.5% lower on Tuesday after a special court ordered Central Bureau of Investigation (CBI) to further probe involvement of Hindalco and its chairman Kumar Mangalam Birla in allocation of coal blocks.
According to a Bloomberg report, special Court Judge Bharat Parashar asked the CBI to record the statement of former Indian Prime Minister Manmohan Singh, who was then coal minister. The case against Hindalco, Birla, a former coal secretary, and others involves the 2005 allocation of the Talabira coal blocks in the eastern state of Odisha to the company.
As per the report, the case was registered on October 14, 2014, and was followed by searches at various locations in the cities of Mumbai, New Delhi, Hyderabad and Bhubaneswar. In August 2012, the state auditor in a report said that the country’s policy of allocating coal mines without auction may have cost the government 1.86 trillion rupees ($29 billion).
The contraction in Chinese manufacutring activity added further pressure on metal stocks. The BSE Metal was trading 4.1% lower at 3.10 pm IST.
The HSBC/Markit China manufacturing purchasing manager’s index’s initial reading fell to 49.5 in December from November’s final reading of 50.
Hindalco shares were trading 5.7% lower at Rs 144.7 apiece on the BSE.