Birla stocks get that sinkin' feeling

CBI has filed a first information report (FIR) against Aditya Birla group chief Kumar Mangalam Birla in connection with the 2005 coal blocks allocation scam and he will be soon called-in for questioning. The group’s aluminium maker Hindalco Industries has also been booked by India’s chief investigating agency, on Supreme Court directive.

Thus, all stocks part of the US $ 40 billion Aditya Birla group – Hindalco, Ultratech, Aditya Birla Nuvo, Idea Cellular – are ruling weak, down 2-5% in Tuesday’s trade.

Hindalco Industries has taken the biggest beating down almost 5% to 105.10 in opening trade, before bouncing back to 108.55. Aditya Birla Nuvo is down 3.5% at 1,219 while Ultratech Cement is ruling soft by 1.3% to 1,950. Idea Cellular which opened weak has now made up all the losses and is ruling firm at 185, on the back of its signing unified licenses for 7 telecom circles with DoT.

‘Coalgate’ has already taken a toll on India Inc and Birla group is just another drop in the ocean.