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Sterlite Copper

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Sterlite Industries (India) Limited
Company typePublic company
IndustryMetal, Mining
Founded8 September 1975, Calcutta, India
SuccessorSesa Sterlite Limited
Area served
Worldwide
Key people
Anil Agarwal
(Chairman)
RevenueIncrease₹126.58 billion (2007-08)[1]
Number of employees
1500
ParentVedanta Limited

Sterlite Copper is a subsidiary of Sterlite industries, a company owned by Vedanta Limited.

History

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It was originally incorporated as Rainbow Investments in 1975, the name of the company was changed to Sterlite Cables in 1976. It was later renamed Sterlite Industries in 1986. With a restructuring in July 2000, the company is left with only a metal division comprising copper and aluminium divisions.

In 1994, it acquired Madras Aluminium Company (MALCO) for ₹55 crores. Sterlite and its associate companies took a 55% stake in India Foils for ₹50 crores. This improved Sterlite's product mix from aluminum to aluminum foil with the largest market share of 65%.[2] In 1999, the company acquired Copper Mines of Tasmania.[3]

In February 2011, Sterlite Industries acquired Lisheen Zinc Mine in Ireland from Taurus International S.A., for a share value of approximately $546 million.[4] In September 2013, SESA Goa, Sterlite Industries and Vedanta Aluminium merged to form Sesa Sterlite Limited.[5] It was listed on the NYSE in June 2007.[6]

Overview

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In 1992, Maharashtra Industrial Development Corporation was allotted a plot in Ratnagiri district's Zadgaon village.[7] On 13 December 1993, over 30,000 people of the city marched to the unit and demolished the quarters for the construction workers and some other structures.[8][9] After that incident Sterlite was relocated to Thoothukudi.[citation needed]

Three state governments, Gujarat, Goa, and Maharashtra have refused permission to the Vedanta Group to set up its 40,000 tonnes capacity due to its high polluting nature of the Sterlite copper smelting plant before the company managed to convince the Tamil Nadu government. Since its commencement in 1997, the plant had been found on numerous occasions to flout the pollution norms with impunity and foregone permit requirements by pollution regulators, as observed by the courts.[10]

Sterlite operated the largest copper smelter plant in India, in Thoothukudi from 1998 to 2018. The plant was not operational from March 2018 and was shut down by the Government of Tamil Nadu on 28 May 2018 after protests from locals. The plant also included a refinery, a phosphoric acid plant and a sulphuric acid plant.[11] The company's main operating subsidiaries are Hindustan Zinc Limited for its zinc and lead operations; Copper Mines of Tasmania Pty Limited for its copper operations in Australia; and Bharat Aluminium Company Limited for its aluminium operations. It also operates a copper mine in Australia.[12]

COVID-19

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In late April 2021, considering the COVID-19 situation and oxygen requirement, Sterlite Copper received special permission from the Government of Tamil Nadu to produce medical oxygen at their copper smelter plant in Thoothukudi, which was closed since 2018 after the state government's order.[13] The company generated and despatched over 542.92 metric tonnes of liquid medical oxygen by June 2021 to help India deal with COVID-19.[14] This is in addition to 953 oxygen cylinders containing 6671Nm³ of gaseous oxygen were supplied to meet the requirements of COVID-19 patients and hospitals.[15] It also donated ₹5 crore (US$599,095) to the Government of Tamil Nadu Chief Minister's Public Relief Fund in April 2021.[16]

Financials

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The company reported ₹1,055 crores as its operating profit in India in the financial year 2018. In FY20, it recorded an operating profit of negative ₹300 crores.[17] It reported a loss in Ebitda of ₹235 crore and a revenue drop by 57% to ₹10,739 crore during the fiscal year 2018-19, compared to FY 2018-17, primarily due to the shutdown of Thoothukudi smelter in Tamil Nadu. In 2017-18, the company reported an Ebitda profit of ₹1,055 crore. The company's revenue was ₹24,951 crore in the FY18.[18]

Controversies

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In 2001, Sterlite industries, BPL and Videocon were found guilty by SEBI of having colluded with Harshad Mehta and 17 brokers (10 from BSE and 7 from NSE) in a bid to corner shares and rig shares prices. This resulted in a ban on the company from accessing capital markets for 2 years.[19] In 2003, Vedanta Resources (UK) was listed on the London Stock Exchange in the second largest floatation of the year in LSE. Vedanta Resources is a holding company that owns many entities including a large proportion of Vedanta Limited and Sterlite industries.[20]

Vedanta Sterlite Copper Public Relations:

Vedanta Sterlite Copper, a major entity in the mining and metallurgy sector, collaborates with an official Public Relations agency to manage its public communications. The PR efforts are focused on providing accurate and transparent information to the public, stakeholders, and the wider community.

Thoothukudi violence

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Main article: Thoothukudi violence

The Thoothukudi Copper Smelting plant has been long-opposed[11] by the local residents for polluting their environment as well as causing a range of health problems and has been subject to several closures, on grounds of violating environmental norms.[21]

The National Environmental Engineering Research Institute (NEERI) and the Tamil Nadu Pollution Control Board (TNPCB) found evidence that Sterlite contaminated the groundwater, air and soil with its effluents and also violated standards of operation.[11]

In 2010, the Madras High Court had ordered a shut down of the same plant, for violating environmental regulations which was subsequently challenged by the group in the Supreme Court.[22] The Supreme Court, in April, 2013 struck down the Madras high court's order[11] and instead fined Sterlite Rs 100 crore for polluting the environment and for operating the plant without a renewal of the consents by TNPCB.[21] Post a favorable ruling by the National Green Tribunal (NGT), the plant soon reopened.[11]

In March 2013, TNPCB re-ordered a closure of the plant on grounds of leakage of gas, leading to nausea and skin irritation among local inhabitants.[22][23][24]

The group has steadfastly denied accusations of any wrongdoing, throughout.[23][21]

In March and April 2018, there were renewed mass-protests against the company's plans of setting up a second smelting complex and demands of an entire shutdown of the smelting plants, on grounds of violating environmental regulations were raised.[25][26] On 22 May 2018 the protests took a deadlier when 20,000 protesters turned violent and subsequently police had to resort to lathi charge and shooting. In the event referred to as Thoothukudi violence 14 people were killed and several others injured. Section 144 was imposed to control the situation.[27]

On 28 May 2018, the Government of Tamil Nadu ordered the permanent closure of Sterlite plant in Thoothukudi.[28] [29][30] This action of TN Government was set aside by NGT on 15 December 2018, directing the TNPCB to pass fresh order of renewal of consent and authorization to handle hazardous substances. Though the Supreme Court of India set aside these directions on appeal by TN Government, Justices Rohinton Fali Nariman and Navin Sinha held on 18 February 2019 that the NGT had no jurisdiction to entertain the matter. But the ADMK parties are given rights to approach the Madras High Court.[31]

Aftermath and impact

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On 28 October 2018, Tamil Nadu Pollution Control Board reported that the sulphur-dioxide levels in the air had reduced significantly after the Sterlite plant's closure.[32] TNPCB also confirmed an improved Air Quality Index.[33]

As it was classified as a red category, the district administration has maintained the smelter premises since its closure. On 22 March 2019, the company submitted an affidavit to the Madras High Court, claiming the damage of ₹100 crore (US$12 million), which was caused due to negligence in maintaining the premises by the district authorities.[34]

Three years after closure of Sterlite, A 2022 study conducted by the Asian Institute of Technology, Bangkok and National Institute of Technology, Jamshedpur, indicated no significant change in the air quality and sulfur dioxide contribution to pollution in Thoothukudi before and after the closure of the smelter in 2018,.[35] While the closure of Sterlite caused immediate noticeable improvement in air quality by TNPCB, another study conducted by Anna University and the Centre for Climate Change and Adaptation Research confirmed that the road dust and vehicular emission as major factors contributing for the dust, causing poor air quality and make tuticorin already unsustainable .[36]

In June 2019, Mint reported that the company faced a loss of about $200 million in profits ever since its copper smelter plant got closed.[37] Around 20,000 people lost their jobs, who were employed by the company due to the shutting of the smelter and about 98,400 people were affected in the consumer or downstream industries. The plant's closure also caused a cascading effect on the supply chain of chemicals and the associated industries that operate using products of Sterlite Copper.[34][38]

According to commerce ministry data, it impacted India's industrial metal exports and led to becoming a net importer beginning 2018-19.[39][40] In March 2021, in a written response in the Lok Sabha, Pralhad Joshi, the Minister of Mines, Coal and Parliamentary Affairs, informed the lower house that the plant's closure has affected the domestic production of refined copper. The copper production of India dropped to 410,000 tonnes in 2019-20 from 830,000 tonnes in 2017-18 and the refined copper output in 2018-19 was 450,000 tonnes.[41]

In 2021 and 2022, controversially it was also reported that petitions were filed by some villagers, fishermen and a few local organizations demanding the reopening of Sterlite Copper including the victims of police firing on anti-Sterlite protests.[42][43][44][41]

While the Justice Aruna Jagadeesan Commission did not find any "direct evidence" that points to the involvement of either Sterlite Industries, as claimed by a few activist groups, or any outfit, as alleged by the then government and a few individuals such as actor Rajinikanth, in the violence of 22 May 2018, it is clear state government, three Tahsildars, 17 police personnel and the then District Collector, N Venkatesh co-ordinated inaction, lethargy, complacency and dereliction of duty.[45]

CSR

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The company is engaged in various CSR activities, supporting health, education, environmental and humanitarian causes. In June 2019, the company supplied RO purified water to 1,400 families in 12 villages as part of the Muthucharam - Tamira Surabhi Project during the water crisis.[46] It has launched Tamira Muthukkal, a project under the Muthucharam Initiative that provides skill training modules on various courses to help the youth of Thoothukudi to seek employment. It has also launched a skill center, offering courses and training in logistic trade.[47] It runs a project called Ilam Mottukal, which works for the education of girl child in the Thoothukudi district[48] and also runs a scholarship program called Sterlite Educational Scholarship.[49] In December 2018, it announced to allocate ₹100 crore (US$12 million) to set up social infrastructure, including building a hospital and one million trees plantation in Thoothukudi, Tamil Nadu.[50] Sterlite donated ₹5 crore (US$599,095) to the Chief Minister's Public Relief Fund during COVID-19 pandemic in April 2021.[16]

Awards and recognition

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References

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  1. ^ "Sterlite". Retrieved 1 April 2008.
  2. ^ H. R. Machiraju (2007). Mergers, Acquisitions and Takeovers. New Age International. p. 158. ISBN 9788122414387.
  3. ^ "Sterlite to buy Mount Lyell copper mine in Tasmania". Rediff.com. 25 March 1999.
  4. ^ "Sterlite completes acquisition of mine co in South Africa". The Hindu. 5 February 2011.
  5. ^ "Key Facts". Sesa Sterlite. Retrieved 18 February 2014.
  6. ^ "terlite launches ADS issue, applies for NYSE listing". Livemint. 5 June 2007.
  7. ^ Vyas, Maulik. "Sesa Sterlite gets relief from Bombay High Court in Ratnagiri land case". The Economic Times.
  8. ^ "Copper unit comes a cropper".
  9. ^ "Evicted from Ratnagiri".
  10. ^ "Three states refused to set up Sterlite plant before it came up in Tamil Nadu". Deccan Herald. 23 May 2018. Retrieved 15 January 2022.
  11. ^ a b c d e "As Sterlite Plant Expands, a City Erupts in Protest". The Wire. Retrieved 19 April 2018.
  12. ^ "Sterlite Industries India Ltd (SLT) Company Profile | Reuters.com". reuters.com. 2011. Archived from the original on 1 February 2013. Retrieved 19 May 2011.
  13. ^ "Vedanta's Sterlite copper plant begins production of medical oxygen amid Covid crisis". India Today. 13 May 2021.
  14. ^ MP, Siddharth (8 June 2021). "COVID-19: Sterlite claims to have produced over 542MT of liquid medical oxygen for Tamil Nadu". WION.
  15. ^ "Sterlite donates medical equipment to GHs". The Hindu. 1 July 2021.
  16. ^ a b "Sterlite Copper donates Rs 5 crore to Tamil Nadu CM's public relief fund". The Times of India. 18 April 2021.
  17. ^ Sontanam, Satya (18 August 2020). "Plant closure unlikely to impact Vedanta's profitability much". The Hindu Business Line.
  18. ^ Narasimhan, T E (14 July 2019). "Sterlite's closure hits Vedanta copper earnings; revenue drops by 57%". Business Standard.
  19. ^ "Press release - Ref.No.PR 71/2001 (19 April 2001)". www.sebi.gov.in. SEBI. Retrieved 17 October 2018.
  20. ^ "16 years of fraud?". www.minesandcommunities.org. Mine and communities. Retrieved 17 October 2018.
  21. ^ a b c "Sterlite protests". Scroll.in. 6 April 2018.
  22. ^ a b "Vedanta's copper smelting plant ordered to stop operations". Deccan Herald. 30 March 2013. Retrieved 17 February 2014.
  23. ^ a b "TN government orders closure of Sterlite copper smelter". The Hindu. Chennai, India. 31 March 2013. Retrieved 17 February 2014.
  24. ^ "Vedanta group's copper plant ordered to be shut down | Latest News & Updates at Daily News & Analysis". dna. 30 March 2013. Retrieved 19 April 2018.
  25. ^ "Protests against Sterlite in Tuticorin enter 50th day". Times of India. Retrieved 9 April 2018.
  26. ^ "'Ban Sterlite': Thousands of protesters hit the streets demanding closure of copper plant in Thoothukudi". The New Indian Express. Archived from the original on 30 March 2018. Retrieved 19 April 2018.
  27. ^ "Thoothukudi Sterlite violence: One more injured person dies, the total death toll in anti-Sterlite protests till now is 14". National Herald. Retrieved 17 October 2018.
  28. ^ "Tamil Nadu government orders permanent closure of Sterlite plant in Tuticorin". The Economic Times. 28 May 2018.
  29. ^ "TN govt orders permanent closure of Vedanta group's Sterlite plant in Tuticorin - Times of India ►". The Times of India.
  30. ^ Varadhan, Sudarshan (28 May 2018). "India closes Vedanta copper smelter permanently after bloody protest". U.S.
  31. ^ "SC Sets Aside NGT Order Which Allowed Re-Opening of Sterlite Plant at Tuticorin". 18 February 2019.
  32. ^ "SO2 levels have reduced significantly after closure of Sterlite plant". 28 October 2019.
  33. ^ "Tuticorin Air Quality Improves Noticeably After Sterlite Closure: TNPCB Data". 11 December 2019.
  34. ^ a b Wisely Dass, S Godson (28 May 2020). "Shuttered, Thoothukudi Sterlite Copper plant incurs Rs 5 crore loss every day". New Indian Express.
  35. ^ Jacob, Shine (29 January 2022). "Thoothukudi air quality saw no change post Sterlite unit closure: Study". Business Standard.
  36. ^ Govardan, D (31 January 2022). "Tamil Nadu cities get that choking". The Times of India.
  37. ^ "Vedanta lost $200 mn due to Tuticorin plant shutdown: Agarwal". Livemint. 16 June 2019.
  38. ^ Jacob, Shine (1 October 2021). "How prolonged closure of Sterlite plant is impacting copper exports". Business Standard.
  39. ^ Nair, Remya (19 November 2019). "How shutting down of 1 plant turned India from copper exporter to importer in under 2 years". The Print.
  40. ^ Chandrashekhar, Anandi; Vaitheesvaran, Bharani (1 June 2018). "Sterlite closure: No immediate crisis but concerns on future copper supply". The Economic Times.
  41. ^ a b Jagannathan, KT (21 October 2021). "Sterlite Copper plant in Tamil Nadu is back in the spotlight". Moneycontrol.com.
  42. ^ https://www.freepressjournal.in/business/victims-of-police-firing-on-anti-sterlite-protests-want-its-thoothukudi-plant-to-reopen [bare URL]
  43. ^ "Plea to reopen Sterlite Copper plant". The Hindu. 3 January 2022.
  44. ^ "Reopen Sterlite plant: fisherwomen". The Hindu. 11 October 2021.
  45. ^ "Thoothukudi firing: Inquiry Commission report names top police officials for violations". 18 August 2022.
  46. ^ "Sterlite to supply water to 20 villages". The Hindu. 9 June 2019.
  47. ^ "Sterlite Copper launches free training in logistic trade". The Hindu. 27 December 202.
  48. ^ "Sterlite Copper supports Education of 8030 girl children of 83 Schools in Thoothukudi district". Indiacsr.in. 23 June 2016.
  49. ^ "Sterlite Copper gives scholarships". The Times of India. 31 May 2019.
  50. ^ "Sterlite Copper plans to spend Rs 100 cr for setting up social infra in Thoothukudi". Moneycontrol. 20 December 2018.
  51. ^ "ASQ Names International Team Excellence Award Finalists". Quality Magazine. 6 April 2009.
  52. ^ "Award for Sterlite Copper". The Hindu. 18 March 2011.
  53. ^ "FICCI, HSBC water awards for nine companies". The Hindu Business Line. 8 August 2012.
  54. ^ "Sterlite Copper wins Assocham appreciation award". The Hindu Business Line. 23 December 2012.
  55. ^ "Sterlite bags safety award". The Times of India. 26 September 2013.
  56. ^ "Sterlite Copper bags award". The Hindu. 14 July 2016.
  57. ^ "Sterlite Copper bags 'Excellence in water management' award". The Hindu. 1 November 2016.
  58. ^ "Sterlite Copper wins energy award". The Times of India. 7 September 2017.
  59. ^ "'India Manufacturing Excellence Awards 2017' lauds Future Ready Factories across the Manufacturing Industry in India". ficci.in. 14 December 2017.
  60. ^ "Sterlite Copper wins British Council's 'Sword of Honour' award". The Times of India. 4 January 2018.
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