March 15, 2013 / 15:53 IST
Moneycontrol Bureau
State-owned
Coal India (CIL) has increased its supplies to power companies in the April-Jan period. Traditionally, it supplies 70 percent of its produce to power utilities and the remaining is for consumers from other sectors.
Of the 29 metric tonnes of incremental coal produce, power companies got only 2 MT instead of 8.7 MT which was sold to power companies.
Between the April-January period in FY13, CIL's production increased six per cent and off-take grew eight per cent. But supply to power utilities jumped 11 per cent. "The extra coal for power was made available partly by increasing the sector's allocation from the incremental off-take of 29 million tonnes (mt) and partly though liquidation of stocks," states a Business Standard report
Will this re-jig impact CIL financially?
Yes, it will. Consider this: CIL sells coal to power companies at 30 percent lower price than what it sells to other sectors. The coal producer’s realisation from non-power companies is around Rs 1,450 a tonne, compared to Rs 1,150 a tonne from power consumers. The difference of Rs 300 each tonne will further lead to Rs 200 crore dent according to the report.
Acording to CNBC-TV18, CIL has already signed fuel supply pacts with power companies for their upcoming projects . "Coal India Ltd has signed 56 fuel supply agreements (FSAs) with the power plants as on March 2," minister of state for coal Pratik Prakashbapu Patil had said in a written reply to Lok Sabha.
Meanwhile, CIL has created a war-chest of Rs 35,000 crore for acquisition of coal assets abroad to be spent till 2017, of which Rs 2,490.94 crore will be invested in new projects and another Rs7,039.38 crore in non-mining sector projects.
CIL has issued a notice on February 27 inviting proposal from investment bankers, owners/representatives for acquisition of coal assets abroad.
The company has announced an interim dividend of Rs 9.70 in FY13
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