The company claimed that the higher capex was achieved despite delays in the procurement of certain equipment due to restrictions on Coronavirus. Capex is one of the metrics on which the government tests the efficiency of a state-owned company.
Coal India Ltd ‘s investment is geared towards imminent competition following the legalization of coal mining, with the world’s largest coal mining company responsible for 117% of its planned capital expenditure in the first quarter.
In a statement, the state-run company reported that its capex was Rs 844 crore against the target set by Rs 720 crore for the period April-June. This was 4.2 per cent higher than the Rs 810 crore invested by the company in the same period of the last fiscal year.
The company claimed that the higher capex was achieved despite delays in the procurement of certain equipment due to restrictions on Coronavirus. Capex is one of the metrics on which the government measures the efficiency of a state-owned enterprise.
Three subsidiaries — South Eastern Coalfields Ltd (SECL), Northern Coalfields Ltd (NCL) and Central Coalfields Ltd (CCL)—represented 81% of the capex. SECL tops the list with Rs 435 crore investment, followed by NCL with Rs 149 crore and CCL Rs 102 crore.
Purchase of large earthmoving equipment and other plants and machinery accounted for Rs 393 crore. This was followed by Rs 241 crore spent on evacuation and transport facilities, such as coal handling plants, silos, crushers, rail sidings / corridors. Mine production, discovery and prospecting costs Rs 80 crore and Rs 66 crores, respectively. The balance has been expended on ‘other hands.’
Coal India ‘s budget for the 2020-21 capex is pegged to Rs 10,000 crore. Plant and equipment have been given a lion’s share of more than Rs 3,700 crore. The budget for land acquisition and reconstruction and resettlement is projected at more than Rs 1,900 crore. These two heads make up about 57% of the overall capex. The balance of 43% of the Capex budget will be allocated to the transport of coal evacuation, mining production, car procurement, etc.
