The permanent closure of Vedanta Resources Plc’s copper operations in India is marginally credit negative as it will lower the company’s scale and business diversity, Moody’s Investors Service on Friday said.
The Tamil Nadu government on 28 May ordered the state pollution control board to seal and “permanently” close the Vedanta group’s Sterlite copper plant in Tuticorin following violent protests over pollution concerns during which 13 people were killed in police firing.
“The permanent closure of Vedanta’s Indian copper operations is credit negative because it will reduce the company’s scale and business diversity, adding pressure to its other business segments to maintain their strong performance and make up the total revenue and EBITDA decline,” Moody’s said in a statement.
Further, it said, the cancellation of Vedanta’s land rights towards the copper expansion is a key concern in view of the company’s ability to restart copper smelting operations. Read More
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