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Coal India Limited

 

Coal India Limited (CIL) as an organized state owned coal mining corporate came into being in November 1975 with the government taking over private coal mines. With a modest production of 79 Million Tonnes (MTs) at the year of its inception CIL today is the single largest coal producer in the world. Operating through 81 mining areas CIL is an apex body with 7 wholly owned coal producing subsidiaries and 1 mine planning and consultancy company spread over 8 provincial states of India. CIL also fully owns a mining company in Mozambique christened as 'Coal India Africana Limitada'. CIL also manages 200 other establishments like workshops, hospitals etc. Further, it also owns 26 technical & management training institutes and 102 Vocational Training Institutes Centers. Indian Institute of Coal Management (IICM) as a state-of-the-art Management Training 'Centre of Excellence' - the largest Corporate Training Institute in India - operates under CIL and conducts multi disciplinary management development programs.

CIL having fulfilled the financial and other prerequisites was granted the Maharatna recognition in April 2011. It is a privileged status conferred by Government of India to select state owned enterprises in order to empower them to expand their operations and emerge as global giants. So far, the select club has only five members out of 217 Central Public Sector Enterprises in the country.

UNMATCHED STRAGTEGIC RELEVANCE

  • Produces around 81.1% of India's overall coal production
  • In India where approximately 52% of primary commercial energy is coal dependent, CIL alone meets to the tune of 40% of primary commercial energy requirement
  • Commands nearly 74% of the Indian coal market
  • Feeds 82 out of 86 coal based thermal power plants in India
  • Accounts for 76% of total thermal power generating capacity of the Utility sector
  • Supplies coal at prices discounted to international prices
  • Insulates Indian coal consumers against price volatility
  • Makes the end user industry globally competitive

Thus, plays a key role in "India Growth Story" and making India incorporate globally competitive.

CORPORATE STRUCTURE AND SUBSIDIARY COMPANIES

Coal India is a holding company with seven wholly owned coal producing subsidiary companies and one mine planning & consultancy company. It encompasses the whole gamut of identification of coal reserves, detailed exploration followed by design and implementation and optimizing operations for coal extraction in its mines. The producing companies are:

  • Eastern Coalfields Limited (ECL), Sanctoria, West Bengal
  • Bharat Coking Coal Limited (BCCL), Dhanbad, Jharkhand
  • Central Coalfields Limited (CCL), Ranchi, Jharkhand
  • South Eastern Coalfields Limited (SECL), Bilaspur, Chattisgarh
  • Western Coalfields Limited (WCL), Nagpur, Maharashtra
  • Northern Coalfields Limited (NCL), Singrauli, Madhya Pradesh
  • Mahanadi Coalfields Limtied (MCL), Sambalpur, Orissa
  • Coal India Africana Limitada, Mozambique
  • The consultancy company is Central Mine Planning and Design Institute Limited (CMPDIL), Ranchi, Jharkhand.

North Eastern Coalfields (NEC) a small coal producing unit operating in Margherita, Assam is under direct operational control of CIL.

Coal India's major consumers are Power and Steel sectors. Others include Cement, Fertiliser, Brick Kilns, and small scale industries.

PRODUCTION AND GROWTH

Coal India produces over 450 Million Tonnes of Coal annually. Coal production ending Financial Year 2014 was 463 Million Tonnes (MTs). CIL's dynamic production momentum is evident in the fact that in recent years, CIL leaped from 300 MTs mark achieved in 2003-04 to 400 MTs (2008-09) in a time span of 5 years. It took CIL 12 years to cross the 300 MTs production mark from that of 200 MTs achieved in 1991-92.

Two of the subsidiary companies of CIL South Eastern Coalfields Limited and Mahanadi Coalfields Limited are in the elite club of 100 MTs coal producing companies which number only a few worldwide.

ACQUIRING ASSETS ABROAD

It is becoming increasingly evident that domestic coal demand is far outstripping the indigenous production in India. The gap between demand and supply is ever expanding. Especially so in the wake of increased capacity addition in power sector which predominantly coal dependent.

In spite of best efforts, realistically CIL would not be able to satiate growing coal demand. Letters of Assurance (LoA) issued so far are already in excess of CIL's production. Present analysis indicate that there would be a shortage of 260 MTs of coal by 2016-17. To meet this need coal import is inevitable.

CIL has taken it upon itself, in the interest of meeting the country's energy requirement, and is foraying into foreign shores for acquisition of coal properties. For the purpose CIL has adopted a three pronged approach. Acquisition of coal properties directly on its own; through equity participation with coal mining companies abroad and through long term coal off-take contracts.

COAL VIDESH

The yawning gap between the country’s demand and availability of coal is likely to increase to 260 MTs by next 5-6 years. Along with the enhancement of the country’s production capacity due thrust has to be given on import of quality coal to overcome this deficit. ‘Coal Videsh’ was formed with the intent of enhancing the energy security of the nation. Coal India is primarily focusing on thermal coal abroad to supplement indigenous availability. CIL has been making diligent efforts to acquire mines abroad through Coal Videsh division by taking up equity stakes in working mines or green field projects on production sharing basis. Through this venture, CIL also envisages to imbibe “Transnational” competence in coal business and transform itself into a global energy company.

Coal India already has a presence in Tete province in Mozambique where exploration in 2 coal blocks is in progress.

COAL RESERVES AND RESOURCES OF CIL

As of April 1, 2010, we had total coal resources of 64,786 million tons, comprising, pursuant of ISP classifications, Proved Geological Reserves of 52,546 million tons, Indicated Geological Reserves of 10,298 million tons and Inferred Geological Reserves of 1,942 million tons. As of April 1, 2010, from our total coal resources of 64,786 million tons, 30,356 million tons had been considered for mining studies (mine planning and feasibility studies), and the remaining coal resources of 34,430 million tons had not yet been considered for such mining studies. From the 30,356 million tons of coal resources that had been considered for mining studies as of April 1, 2010, 21,754 million tons has been estimated as our Extractable Reserves.

FINANCIALS

Market capitalization: US $ 30.76 billion

(All figures in US$ billion)
Year

2010-11

2011-12

2012-13

2013-14

2014-15

Revenues (Turnover)

10.04

13.07

14.71

14.90

14.40

EBITDA (Gross Margin)

3.05

3.88

4.47

4.17

3.61

Net Income (Profit
after tax)

1.81

2.46

2.89

2.52

2.07

Net Worth

5.55

6.74

8.08

7.31

6.09


For any other details please visit www.coalindia.in