Essar misses forecasts as tax case hits
ESSAR Energy yesterday reported earnings which fell short of forecasts in a year blighted by a long-running battle with Indian tax authorities.
The FTSE 100 company is facing twin setbacks in India, its key market for oil products and electricity, due to delays in government approval to mine cheaper coal from its own resources and a court ruling that ended a tax break for a subsidiary.
Full-year earnings before interest, tax, depreciation and amortisation (Ebitda) were $624.8m (£394.2m) compared with $696.5m in 2010 and falling short of an analyst poll predicting $685m.
Shares, worth less than a third of their 2010 listing price, tumbled on the news, with stocks falling 14.6 per cent to 107.6p.
Essar Energy chief executive Naresh Nayyar said he was confident that the company will be able to meet any repayments due on its £783m government loan, which was initially deferred until 2021.