At a time when the Centre is opening up commercial coal mining for the private sector, public sector behemoth Coal India is planning to bring about cost efficiency in production by improving productivity. The state-run miner has charted out plans to increase its capital expenditure to `9,500 crore in 2018-19 to enhance production capacity. CIL’s chairman and managing director Gopal Singh on Friday said while allowing commercial mining is an opportunity for the company to prove its competence and to become more competitive, the coal PSU would continue to remain the market leader. “We have been focusing on reducing cost and improving productivity and efficiency,” Singh said adding that Coal India’s target was to produce coal at a lesser cost than that of the commercial miners. He said the miner achieved 10.9% year-on -year growth in profit before tax during the October-December period of current fiscal since it managed to reduce cost by Rs 52 per tonne. Singh said CIL’s coal prices have been cheaper by 42-64% compared to imported coal even after the price hike in January.
The miner would focus more on mechanisation and automation in a bid to increase its productivity, Singh said. According to him, CIL has exceeded its planned capital expenditure by Rs 100 crore to Rs 8,600 crore in the current fiscal. “Next fiscal, the capital expenditure would be `9,500 crore for enhancing capacity,” he said. The miner produced 495.09 million tonne (mt) during the April to February period of the current fiscal and is expecting to close the year with a production of about 568 mt, against a target of 600 mt during the current fiscal.
CIL, which had a target to produce 531.32 mt during the eleven month period, clocked a 1.4% y-o-y growth in production from 488.06 mt during the same period last fiscal, according to its provisional data. The state-run miner had achieved a 7% y-o-y growth in off-take to 525.09 mt during the April-February period of 2017-18 against a target of 541.60 mt set for the period. The miner had an off-take of 490.86 mt during the same period last fiscal. It is expecting to achieve an off-take of 580.5 mt for the entire year. Singh said the coal behemoth has achieved the highest off-take to the power sector to 454.30 mt with a 6.8% growth in 2017-18.