NMDC shares sink over 7% after adverse reports from Karnataka; Here’s what happened

The draft proposal concerning the increase in iron ore duty is likely to have spread around a few days prior and the government is expected to take a decision regarding it soon, sources told CNBC-TV18.

Karnataka contributes to nearly 35% of NMDC’s overall mix, making it an important state for the mining company, the report stated.

The Karnataka state government is expecting to collect more than ₹10,000 crore in iron ore tax this fiscal.

Last week, the state cabinet greenlit the Mineral Rights & Bearing Land tax bill.

In August 2024, the Supreme Court reaffirmed the states’ authority to collect tax on mineral land and mineral rights. Experts believe that the judgment will adversely impact the industry’s financials and may lead to arrears of more than ₹1.5 to ₹2 lakh crore.

NMDC announces record and deemed dates of bonus shares

A day before the steep fall in its share price, NMDC announced that it had fixed the record and the deemed allotment date of 586 crore bonus equity shares in the ratio of 2:1

It set Friday, December 27, 2024, as the record date and Monday, December 30 as the deemed allotment date. Additionally, the bonus shares will be made available for trading in the market on December 31, 2024, the company said in a regulatory filing.

The mining company further stated that it received “in-principle” approval from the two bourses, BSE and NSE, for the issuance and allotment of 586 crore bonus equity shares of ₹1 each.

Past stock action

The share closed in the red at ₹213.95, down by 5.96% on the National Stock Exchange (NSE).

NMDC’s stock tumbled 12.73% over the week and 3.21% in the month.

However, over the year, the company’s share price jumped 4.63%.

The scrip had hit a 52-week low of ₹179.90 on December 21 last year.

The state-owned company has a market cap of ₹62,524.48 crore as of December 18, 2024, according to the NSE.