We believe mining companies are going to be the key beneficiaries of rising demand of minerals including coal. The capacity constraints and governmental controls (for instance Indonesian government’s quota on export of coal) will lead to repricing of assets. Gujarat Mineral Development Corporation (GMDC) with its lignite mining, Sesa Goa with its iron–ore mining and Ashapura with its bentonite and bauxite (non-captive) reserves in India would be the direct beneficiaries of rising prices of minerals and will enjoy a scarcity premium. Medium to long term prospects seem attractive.
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