Vedanta Aluminium faces a severe environmental fine of INR 71.16 (USD 8.52 million) crore for a suspected breach of fly ash disposal regulation, as issued by the Odisha State Pollution Control Board on April 10, 2025. However, Vedanta Aluminium is repudiating the allegation and is on the way to taking legal action for the same.
Image source: Eco Material Technologies
What is fly ash?
When pulverised coal is burned in a power plant to generate electricity, it creates a hazardous byproduct known as fly ash. In its true nature, fly ash has no benefits, but the byproduct consisting of aluminous and siliceous components is used to extract and produce aluminium-fly ash composites. Although it has no direct use in aluminium smelters, it can serve as a good source of alumina and can be incorporated into aluminium alloys.
The allegation in detail
On April 10, 2025, Vedanta Aluminium was issued a notice by the Ministry of Environment, Forest and Climate Change (MoEF&CC) under the Fly Ash Notification. Under this, the organisation is charged with a fine of a total INR 71.16 crore (USD 8.52 million)
Vedanta Aluminium's take on the allegation
Concerning the regulatory filing with the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE), Vedanta Aluminium repudiates the allegations. Furthermore, the leaders of the company have said to undertake legal remedies. The company is more focused on this because it claims that the decision to impose the fine was made without a proper investigation of its prior submissions and compliance records.
Irrespective of this emerging news, the shares of the company rose to 2.65 per cent to INR 380.30 (USD 4.56), which is reckoned to be ahead of the development. Moreover, a brokerage firm, Investec, has upgraded the company from a "hold" to a "buy" rating. Additionally, ignoring the dispute that the company is facing, the investing firm kept the price target for the firm at INR 510, suggesting a potential upside of 35 per cent.
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