Coal news and updates

There are two or three largecaps which are making the news today. Let us start off with Tata Steel. You have a close association with London as well. They are getting out of some businesses. What does this mean for Tata Steel? 

Pashupati Advani: Obviously they have decided that this whole British field is bleeding and they want to get out of it because it looks like they are losing ¬¬ almost a million pounds a day is what they are saying. But there is some kind of consolidation going on in the European steel industries. So this is part of it ¬¬ whether they will exit Europe totally or not I do not know but certainly there is some technology enhancement required in their biggest plant in UK. They are not being allowed to do it because of the unions; they have been stuck and they are losing money. So there is some plan to may be do that. 

ET Now: How positive is this from an investors perspective? 

Pashupati Advani: From the investors perspective it is good because they are stemming the losses. The difficulty is that having made Tata into a brand name, it is going to have a backlash on all the other companies and it is already happening in the sense that the British government is after the visas of TCS. May be JLR will be affected because there is a lot of noise about what Tatas are doing and that the Tatas are trying to hurt Britain but the reality is you are a businessperson and you are losing 350 million pounds a year. So either the government has to subsidise or they have to be allowed to get out. 

ET Now: Will you buy Tata Steel? 

Pashupati Advani: Yes, I think so but you need to see how the deal is panning out. Obviously, it has gone up a lot based on the news that has come so far but once there is more clarity on the deal, it will be worth buying on a medium to long term because it was really bashed and it is off for 20 per cent of the bottom. ET Now: If there is some tinkering on 5/20, it will not be positive for the existing aviation companies. Is this something that is anticipated and is making these stocks go up or is it just a trading momentum? Pashupati Advani: It is a trading momentum. It is really a function of the fact that holidays are coming, the flights are going full, prices ofticket seem to be going up. So it is just a perception that the revenues are better and that is what is driving the sector. If 5/20 remain same, it is good for Jet and Indigo or if they are going to liberalise it, the others are not really listed. So I do not know how to play that one. Frankly it is a very difficult space because the new players like Air Asia and Vistara are ready to go. Let us see what happens.  

Source: Economic Times