Usha Martin jumps on wining coal block

Usha Martin is up and about today morning. Currently up almost 16% at Rs.26.25, the mood on the counter is extremely positive.

This upbeat mood is because it has emerged that the company had won the bid for Vrinda and Sasai mines in the second round of coal mining. The company had bid and won at Rs.1804/tonne. But it is not as though the coal from the mines will start coming immediately; the wait would be for around 18 months for this coal block to be operational and will have to travel a distance of 170 kms to get to Usha’s plant. This price of Rs.1804/tonne is the highest bid and the company feels that it is worth this price due to the locational advantage. In an TV interview, the company said that the landed cost plus the premium made perfect economical sense for its Directly Reduced Iron and power production.