Utilities in the power sector present an interesting investment case at this moment. Most power stocks have lost substantial ground in the past 12 months.
State-owned CIL on Monday said coal supply to the power sector rose 15.6 per cent to 49.7 million tonne last month in the wake of high demand of the dry fuel from electricity generating plants and stressed that it is planning to augment its dispatches further, especially to power plants in the coming months. The statement comes at a time when several parts of the country are grappling with power crisis. "With the intense demand for coal continuing unabated driven by an upward spiral in the electricity generation, CIL (Coal India) pushed up its supplies to power plants of the country to 49.7 million tonnes (MT) in April'22.
The Q2FY25 revenue for Coal India (CIL) was reported at Rs 30,700 crore (down 6 per cent year-on-year or Y-o-Y and 16 per cent sequentially). The blended average selling price was Rs 1,622/tonne (down 6 per cent Y-o-Y and 3 per cent quarter-on-quarter or Q-o-Q). Adjusted operating profit stood at Rs 7,200 crore (down 20 per cent Y-o-Y and 38 per cent Q-o-Q) due to lower-than-expected e-auction volumes and higher costs.
Eleven bidders, including Adani Enterprises, have shown interest in the first-ever coal import tender issued by national miner Coal India (CIL). Recently, state-owned NTPC awarded 6.25 million tonnes (mt) of imported coal tender worth Rs 8,300 crore to Adani Enterprises. CIL, in a public statement on Tuesday, said: "The prominent Indian agencies among them (11 coal importers) were Adani Enterprises, Mohit Minerals, and Chettinad Logistics. "A couple of coal exporting agencies from abroad, including one from Indonesia, have also shown interest," it said.
State-owned mining giant, Coal India, is hoping to recover around 75-80 per cent of its liabilities from customers with whom it has long-term fuel supply agreements (FSAs) after the Supreme Court (SC) allowed states to recover dues retrospectively. A legal recourse, however, is underway. "We are impacted in two states - Jharkhand and Odisha.
Corporate India continues to be generous in rewarding its shareholders with big dividend payouts. This is especially true for shareholders of companies such as Tata Consultancy Services (TCS), Hindustan Zinc (HZL), and Coal India (CIL) which are seen as cash cows of large business groups and the government. Boosted by a big payout by these three companies, the combined equity dividend payout by listed companies was up 38 per cent year-on-year (YoY) to a record high of Rs 2.27 trillion in 2022-23 (FY23), compared with Rs 1.65 trillion in 2021-22 (FY22).
Coal India looks set to achieve its 2024-25 (FY25) production targets. If it can achieve its aim of ramping up Fuel Supply Agreement (FSA) and e-auction volumes, along with cost-saving, evacuation and infrastructure-improvement projects, the company could maintain its momentum as a critical infrastructure and core industry performer. Analysts estimate e-auction volumes of 108 million tonnes (MT) in FY25 and 120 MT for FY26, which is encouraging given the premium of e-auction prices which are consistently over 50 per cent higher than FSA.
'With the deployment of a higher degree of mechanisation, awarding contractual mining to MDOs and operational efficiency, we feel confident of achieving the desired target.'
State-owned CIL on Thursday said that it has floated its maiden tender to import 2.416 million tonnes of coal to ensure adequate supply of the fuel to power plants in the country. The development assumes significance in the wake of the government making all efforts to build up stock of coal to avoid the reoccurrence of power outages which happened in April on account of shortage of the fossil fuel. "In a first ever, Coal India Limited (CIL) on Wednesday floated an international competitive bidding e-tender, seeking bids for import of 2.416 million tonnes (MTs) of coal," the company said in a statement.
Coal behemoth CIL on Thursday reported a 26.2 per cent rise in consolidated net profit to Rs 8,682.20 crore for the March quarter on the back higher supplies of the dry fuel. The company's consolidated net profit stood at Rs 6,875.07 crore in the year-ago period, Coal India Ltd (CIL) said in a regulatory filing. Its consolidated income in the January-March period declined to Rs 39,654.50 crore from Rs 40,371.51 crore a year ago.
Coal India's (CIL's) revenue for the first quarter of 2024-25 (Q1FY25) came in at Rs 36,500 crore, up 1 per cent year-on-year (Y-o-Y) and down 3 per cent sequentially, which was in line with consensus. The blended average selling price was Rs 1,687/tonne, down 5 per cent Y-o-Y and down 1 per cent Q-o-Q, which was below estimates. The adjusted operating profit (excluding overburden removal or OBR costs) stood at Rs 11,500 crore up 3 per cent Y-o-Y and up 17 per cent Q-o-Q, which beat the street. This was due to lower operating expenses.
Adani Enterprises has emerged as the lowest bidder in Coal India's tender for imports of the dry fuel with quoting over Rs 4,000 crore for supply of 2.416 million tonne, even though the miner is likely to "negotiate the price", an official said on Monday. A negotiation for the quoted price may take place as the gap between the lowest bid value and the miner's own estimates of Rs 3,100 crore is in excess of around 30 per cent, he said. "Adani's bid is the lowest but it is Rs 900 crore more than the Coal India's own estimate.
Coal India (CIL) produced 89 million tonnes (MT) in March-24, up 6 per cent year on year (Y-o-Y) and offtake was 69 MT, up 7 per cent Y-o-Y. FY24 production was 774 MT, up 10 per cent Y-o-Y. Offtake was 754 MT, up 9 per cent Y-o-Y. CIL targets production of 838 MT in FY25, up 8 per cent Y-o-Y over FY24.
Divestment in PFC, REC, NHPC, Nalco, Hindustan Copper and NMDC could be considered
With farm Acts out of the picture, the government may look at reforming the input side of the agriculture sector - regulations and rules that govern seeds, fertilisers and plant chemicals. Sources said such a blueprint, which is aimed at making the life of farmers easier, with quicker approvals but not compromising on quality, is in the works as part of the 100-day agenda of Modi 3.0. Also, ways to administer fertiliser subsidy more effectively and cutting down on leakages and diversions to build on the success of neem-coated urea are being thought of.
In what seemed a political understanding, Trinamool Congress chief and Railway Minister Mamata Banerjee stayed away from a cabinet committee meeting where the government finally cleared two disinvestment proposals she had been opposing.
CIL workers are represented by five unions -- Indian National Trade Union Congress, Hind Mazdoor Sabha, Bharatiya Mazdoor Sangh, AICWF and All India Trade Union Congress.
To float SPV, levy user charge on consumers to cover investment cost.
These three blocks figure in the 'Schedule I' list of those coal mines, which are being auctioned afresh
Power stations with captive mines might look at this as an opportunity to sell merchant power at higher rates.
The CIL disinvestment has been hanging fire because of opposition from the trade unions. Mayaram's statement that the coal major will have to pay a higher dividend comes as the government makes efforts to meet its Rs 40,000 crore (Rs 400 billion) disinvestment target.
Euphoric about India's biggest IPO, possibly to garner up to Rs 15,000 crore, from the world's largest coal producer CIL, Coal Minister Sriprakash Jaiswal on Friday said October is an "auspicious" month to launch the issue.
Coal India Limited's (CIL) October-December quarter of financial year 2023-24 (Q3FY24) results have beaten the Street's estimates. Revenue rose 3 per cent year-on-year (Y-o-Y) to Rs 36,200 crore, led by higher volumes and better realisation from Fuel-Supply Agreement (FSA) coal. The blended average selling price (ASP) was down 6 per cent Y-o-Y to Rs 1,727 per tonne, and the FSA ASP was up 3 per cent Y-o-Y to Rs 1,532 per tonne.
ArcelorMittal, Anglo Australian major Rio Tinto, Hyderabad-based GVK Power & Infrastructure, Essar Mineral Resources and JSW Steel are among 10 prominent corporations in a shortlist to develop 18 abandoned coal mines owned by state-owned Coal India Ltd and its eight subsidiaries.
Coal India was listed on November 4, 2010, and its market value today stands at over Rs 2 lakh crore.
Conflicting views on Coal India (CIL) might leave investors confused. The bullish perspective that India has strong power demand (and also high steel production) means high demand for coal. As CIL is the monopoly producer of coal -- supplying over 80 per cent of the domestic requirement - the public sector undertaking should be a beneficiary of the rising power demand.
The coal-scam has taken an important turn as the Central Bureau of Investigation has charge-sheeted former bureaucrat P C Parakh and industrialist Kumarmangalam Birla. The next big thing is to see that if the coal-blocks allotted, fraudulently, are cancelled or not either by Supreme Court or by the government as pre-emptive action.
The Competition Commission of India has slapped Coal India Ltd with a penalty of Rs 1,773 crore (Rs 17.73 billion) -- the biggest by the watchdog on a company -- over alleged abuse of its monopolistic position.
The government sold 63.16 crore shares or 10 per cent stake in Coal India through an offer for sale (OFS) on January 30.
Amid strong opposition from CIL workers union to the proposed stake sale in the company, Finance Minister P Chidambaram has said the disinvestment proceeds of about Rs 20,000 crore (Rs 200 billion) from the coal behemoth will be invested in public sector banks.
Rising energy demand could tilt India's energy basket towards fossil fuels from coal to oil, natural gas.
They, however, called off their nationwide strike
In fact, the 9 per cent growth story cannot happen without coal, which fires over 50 per cent of the country's installed power capacity, says Partha S Bhattacharyya.
Prime Minister Manmohan Singh has asked administrative ministeries to work out viable plan for disinvestment of BHEL and Coal India, including dividend payment, so as to achieve Rs 40,000 crore (Rs 400 billion) target in the current fiscal.
The government, which on Thursday decided to sell ten per cent stake in NALCO, now contemplates offloading ten per cent stake in the Coal India Limited through initial public offerring.
Coal India would be second company to hit the markets under the government's disinvestment programme.
The valuation of CIL dropped by Rs 20,875 cr to Rs 2,27,926 cr
In an interview with Business Standard, CIL Chairman Singayapally Narsing Rao attributes the performance to volume growth but adds a decision on price hike will be taken at an appropriate time.
Coal behemoth CIL on Monday came out in support of the government proposal that miners share 26 per cent of profits with local people affected by their projects, while Tata Steel toned down its stance on the issue.
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