Jindal Steel shares head towards biggest fall in 2 yrs on rejection of coal block bids

Shares in Jindal Steel and Power were heading towards their biggest daily loss in almost two years on Monday, hit by concerns over the company’s ability to feed its power plants after the rejection of its bids for three coal mines auctioned by the government. [caption id=“attachment_2077151” align=“alignleft” width=“380”] Reuters[/caption]Stocks of the company, controlled by former lawmaker Naveen Jindal, fell as much as 14.9 percent before paring some losses to trade down 8.66 percent around noon on Monday, while the benchmark BSE Sensex was up 0.14 percent. Separately on Monday, a company source told Reuters that Jindal Steel, which said it was “puzzled” by the government’s decision over the weekend to reject the bids, will take the government to court over the cancellations. The absence of coal blocks for the company’s power business leaves its 3.4 gigawatt (GW) of capacity near-stranded with linkage of only 1.2 GW in place, analysts at brokerage Kotak Institutional Equities said in a report to clients.