Gujarat NRE Coke

Gujarat NRE Coke reported a 11% rise in its topline to Rs 270.04 crore in Q2FY'12 compared to Rs 243.57 crore in the corresponding previous year quarter while bottomline fell 19% to Rs 8.04 crore.

Mr Arun Kumar Jagatramka, Chairman and Managing Director, Gujarat NRE Coke, informed that the company's sales were somewhat affected by the iron-ore crises down south, with major steel plants, many of which source met coke from the company's Dharwad plant were operating at minimal capacity. Also the seasonal effect of rainfalls in Q2 does have a dampening effect on the sales in the entire country, which is a regular phenomenon every year in monsoons. He also mentioned that the company has a steady export order book, and with the situation in iron & steel industry improving in South India, the company has been experiencing the same with orders flowing in the current month

Growth in net sales of the company was supported by 54% increase in steel segment revenues to Rs 84.31 crore contributing 31% of total revenues while coal and coke segment reported 2% fall in revenues to Rs 186.16 crore contributing 69% of total revenues. Coal and coke segment PBIT fell 51% to Rs 27.92 crore contributing 78% of total PBIT while Steel segment PBIT turnaround to Rs 8.08 crore compared to loss of Rs 12.15 crore in the corresponding previous year period contributing 22% of total PBIT.

PBIT margins of the company fell 510 bps to 13.3% as coal and coke segment PBIT margins fell heavily by 1510 bps to 15%. However steel segment PBIT margins turnaround to 9.6% compared to negative margin in the corresponding previous year quarter.

OPM of the company rose 350 bps to 15.7% leading a 9% fall in operating profits to Rs 42.43 crore. Other income of the company rose 68% to Rs 27.74 crore while interest cost rose 20% to Rs 43.60 crore. Depreciation increased 17% to Rs 14.29 crore. PBT as a result fell 17% to Rs 12.28 crore.

The company is increasing its domestic met coke production capacity presently at 1.38 MTPA (million tonne per annum) to 4 MTPA in the next 4-5 years investing around Rs 1000 crore by setting up Greenfield and Brownfield coke plants in the States of Andhra Pradesh, Gujarat and Karnataka The company is also expanding its coking coal production to 6 MTPA in next 4-5 years in Australia from presently 2 MTPA. The company has also undertaken implementation of power plants through waste heat recovery for captive consumption having a capacity of 60 MW which are expected to be implemented in phases by 2011-12 in addition to the existing capacity to generate 87.5 MW of power through wind mills.

For H1FY'12 Net sales of the company rose 2% to Rs 706.19 crore with 400 bps improvements in operating margins to 21.7% leading a 25% increase in operating profits to Rs 153.28 crore. Other income of the company rose 62% to Rs 29.39 crore while interest cost rose 17% to Rs 84.02 crore. Depreciation increased 15% to Rs 27.92 crore. PBT as a result increased 57% to Rs 70.73 crore. The final bottomline of the company increased 56% to Rs 46.70 crore.

In a recent development, Gujarat NRE Coking Coal, the Australian mining company has received New South Wales Planning Assessment Commission's (NSW PAC) approval for its $62 million upgrade and expansion at its NRE Wongawilli mine west of Dapto.

Mr. Arun Kumar Jagatramka, Executive Chairman of Gujarat NRE commented that this news is another milestone for the company and one more step forward towards the company's ultimate growth plan. It is indeed great news for both the company and its stakeholders with NSW PAC approvals for both the mines and recently availed US $100 million facility with Axis Bank, Hong Kong, and the company is looking forward to continue its ongoing developmental activities. It is to be noted that Gujarat NRE is installing longwall mining at its NRE No1 mine and has received the NSW Planning Assessment Commission's approval for its $122 million upgrade of existing infrastructure at NRE No.1 mine at Russell Vale.

The NSW PAC has given written project approval, which allows Gujarat NRE to mine in the Wongawilli seam in the north-eastern part of the lease and also construct an underground roadway to provide access to the western portion of the lease.

Further works approved include the augmenting, upgrading and use of the existing infrastructure at the mine, the extraction of remnant coal reserves within existing mine areas, the extraction of two million tonnes of coal a year from the Bulli and Wongawilli seams for up to five years, rail transportation of coal from the mine and rehabilitation of the site.

The scrip is trading around Rs 22.15 on the BSE

Gujarat NRE Coke Standalone results

Gujarat NRE coke Standalone Segment Results