Coal India earmarks Rs 10K cr capex for FY’12

Coal India Ltd. | Mining & Minerals | Metals & Mining | BSE: 533278 | NSE: COALINDIA

01 Jun 2011 Evaluate

Coal India Ltd (CIL) has earmarked an over Rs 10,000 crore capital expenditure for the current fiscal on capacity expansion and acquisitions that are likely to be completed within the next six months. The company has set aside Rs 6,000 crore for acquisitions and Rs 4,220 crore on developing different projects within the country.The cash-rich company, the world’s largest coal producer, would not require to raise any funds for financing the proposed capex, which would be financed entirely through internal accruals.

The acquisition of overseas coal blocks,having reserves ranging between 50 million tonnes and 150 mt, would help CIL bridge the ever-increasing demand-supply gap within the country. India’s coal output is estimated at 554 mt in 2011-12, out of which CIL is likely to contribute 452 mt. Shortage for the current fiscal has been estimated at 137 mt, most of which is likely to be met through imports.

Meanwhile, CIL, which meets over 80 per cent of domestic demand, has received proposals from five global biggies to import 360 mt of coal over next 10 years, with an average of 36 mt imported every year.

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