The Members, Coal India Limited
Ladies & Gentlemen,
On behalf of the Board of Directors, I have great pleasure in presenting to you, the
40th Annual Report of Coal India Limited (CIL) and Audited Accounts for the year ended
31st March, 2014, together with the reports of Statutory Auditors and Comptroller and
Auditor General of India thereon.
Coal India Limited (CIL) is a Maharatna company under the Ministry of
Coal, Government of India with headquarters at Kolkata, West Bengal. CIL is the single largest
coal producing company in the world and one of the largest corporate employers with a
manpower of 3,46,638 (as on 1st April, 2014). CIL operates through 82 mining areas spread
over eight provincial states of India. Coal India Limited has 429 mines of which 237 are
underground, 166 opencast and 26 mixed mines. CIL further operates 17 coal washeries, (13
coking coal and 4 non-coking coal) and also manages other establishments like workshops,
hospitals, and so on. CIL has 27 training Institutes. Indian Institute of Coal Management
(IICM) is an excellent training centre operates under CIL and imparts multi disciplinary
management development programmes to the executives. Coal India's major consumers are
Power and Steel sectors. Others include cement, fertilizer, brick kilns, and a host of
CIL has eight fully owned Indian subsidiary companies (direct): Eastern Coalfields
Bharat Coking Coal Limited (BCCL),
Central Coalfields Limited (CCL),
Western Coalfields Limited (WCL),
South Eastern Coalfields Limited (SECL),
Northern Coalfields Limited (NCL),
Mahanadi Coalfields Limited (MCL) and
Central Mine Planning & Design Institute Limited (CMPDIL).
In addition, CIL has a foreign subsidiary in Mozambique namely Coal India Africana
The mines in Assam i.e. North Eastern Coalfields continue to be managed directly by
CIL. Similarly, Dankuni Coal Complex also continues to be on lease with South Eastern
MCL has three subsidiaries, namely MNH Shakti Ltd., MJSJ Coal Ltd. and Mahanadi Basin
a. MNH Shakti Limited
MNH Shakti Limited has been formed with MCL having 70% stake along with Neyveli Lignite
Corporation and Hindalco holding the rest. The coal production is targeted from Talabira
OCP with an annual capacity of 20 MT.
b. MJSJ Coal Limited
MJSJ Coal Limited has been formed with MCL having 60% stake along with JSW Steel,
Jindal Thermal Power Limited, Jindal Stainless Steel and Shyam Metallics & Energy
Limited holding the rest. The coal production is targeted from Gopalprasad OCP with an
annual capacity of 15 MT.
c. Mahanadi Basin Power Limited
Mahanadi Basin Power Limited has been formed on 2nd December'2011 as a SPV with 100%
shares held by MCL with power generation capacity of 2X800 MW through Pit Head power plant
at Basundhara Coalfields.
Joint Venture with OPTCL
MCL has also formed a joint venture Company viz., Neelanchal Power Transmission Company
Pvt. Limited (NPTCPL) on 8th January, 2013 with an objective of carrying out power
transmission business jointly with M/s OPTCL having an equity share holding of 50:50.
Subsidiaries of SECL
SECL has formed two subsidiary companies viz. M/s Chhattisgarh East Railway Ltd on 12th
March' 2013 and M/s Chhattisgarh East-West Railway Ltd on 25th March' 2013 with 64%
holding in each of the subsidiaries for construction of railway lines for evacuation of
1. NOTABLE ACHIEVEMENTS
For the year 2013-14, the Company has achieved a production of 462.42 MT,
removed OB of 806.544 MM3 and achieved an off-take of 471.58 MT., with a growth of 2.26%,
8.01% and 1.38% respectively compared to last year.
ECL and BCCL not only achieved their AAP targets of coal production, OB removal
and off-take but also recorded a significant growth in coal production and OB removal.
SECL has also achieved the AAP target of coal production with 5.11% growth.
OB removal during this year is noteworthy as it has registered an overall growth
of 8.01% over last year. The composite excavation (Coal + OB) in CIL has registered a
growth of 6.7% over last year.
Coal supply to power utilities during the year is 353.83 MT., which is 94.1% of
the target and has registered a growth of about 2.4% compared to last year. This dispatch
achievement is 86% against the quantity committed under FSA/MoU to power utilities.
CIL has paid an interim dividend @ of 290% i.e. Rs. 29/-per share of face value
of Rs. 10/-. This is the highest ever dividend paid by the Company till date.
2. FINANCIAL PERFORMANCE
2.1 Financial Results (CIL consolidated)
CIL is one of the largest profit making and tax and dividend paying enterprises. CIL
and its subsidiaries have achieved an aggregate pre-tax profit of Rs. 22,879.54 crores for
the year 2013-14 against a pre-tax profit of Rs. 24,979.04 crores in the year 2012-13.
(Rs. in crores)
|Company (CIL subsidiaries/ CIL standalone)
|Less: Dividend from Subsidiaries
|Adjustment for deferred revenue income
|Adjustment for exchange rate variation on Current Account of overseas subsidiary
|Adjustment for waiver of accrued interest of BCCL
|Overall Profit as per Consolidated Accounts
CIL as a group has achieved post tax profit of Rs. 15,111.67 crores in 2013-14
(excluding share of minority loss of Rs. 0.04 crore; previous year: Nil) as compared to
Rs. 17,356.36 crores in 2012-13.
Highlights of performance
The highlights of performance of Coal India Limited including its subsidiaries for the
year 2013-14 compared to the previous year are shown in the table below:
|Production of Coal (in million tonnes)
|Off-take of Coal (in million tonnes)
|Sales (Gross) (Rs./Crores)
|Capital Employed (Rs./Crores) Note- 1
|Capital Employed (Rs./Crores)- excluding capital work in progress and intangible
assets under development.
|Net Worth (Rs./Crores) (as per Accounts)
|Profit Before Tax (Rs./Crores)
|Profit After Tax (Rs./Crores)
|PAT / Capital Employed (in %)
|Profit before Tax / Net Worth (in %)
|Profit after Tax / Net Worth (in %)
|Earning Per Share (Rs.) (Considering face value of Rs. 10 per share)
|Dividend per Share (Rs.) (Considering face value of Rs. 10 per share)
|Coal Stock (net) (in terms of no. of months net sales)
|Trade Receivables (net) (in terms of no. of months gross sales)
Capital employed = Gross Block of Fixed assets (including capital work in progress and
intangible assets under development) less accumulated depreciation plus current assets
minus current liabilities.
Transfer to reserves
During the year 2013-14, transfer to various reserves out of CIL (standalone) profits
are as under:-
Transfer to General Reserves - Rs. 1500.85 crores
Transfer to CSR Reserves - Rs. 25.34 crores
Transfer to Sustainable Development Reserves - Rs. 10.19 crores
2.2 Dividend Income and Pay Outs (CIL- standalone)
While the financial statements of both CIL standalone and CIL consolidated are
presented separately, it is only the CIL (standalone) which is listed and is relevant for
dividend payment to its shareholders. The dividend to its shareholders are paid out of
CIL's standalone income, the major part of which constitutes the dividend income received
by it (CIL - standalone) from its five profit
making subsidiaries i.e. CCL, NCL, WCL, SECL and MCL.
The breakup of such dividend (interim + final) received and accounted for during the
year from different subsidiaries are given below:-
(Rs. in crores)
|Company (paying subsidiaries)
Dividend Income of CIL (standalone)
During the year, Coal India Limited (standalone) has paid a total dividend (by way of
interim dividend) of Rs. 18317.46 crores @ Rs. 29/- per share on 6316364400 number of
Equity Shares of Rs. 10/- each fully paid up. Out of the above total dividend, the share
of Govt of India was Rs. 16485.71 crores and for other shareholders, Rs. 1831.75 crores.
(Earlier year - Govt of India - Rs. 7958.62 crores and other shareholders - Rs. 884.29
2.3 Observation of the Statutory Auditors
The Statutory Auditors have given their observations on the standalone accounts of the
Company for the year ended 31st March' 2014. The Auditors' observations in terms of
Section 217(3) of the Companies Act'1956 and Management Explanation are enclosed as
3. COAL MARKETING 3.1
(a) Off-take of Raw Coal
Off-take of raw coal continued to maintain its upward trend and reached 471.58 million
tonnes for fiscal ended March 2014, surpassing previous highest figure of 465.18 million
tonnes achieved during the last year, i.e., an increase of 1.4 % over the last year. The
overall raw coal off-take achieved was 95.8 % of the Annual Action Plan Target.
Company-wise coal off-take:-
The Company-wise target vis-a-vis actual off-take for 2013-14 and 2012-13 are shown
Figs. in million tonnes
Growth over last year
From the above, it may be seen that ECL and BCCL had not only exceeded their targets
but also achieved positive growth over last year's off-take. Barring CCL, WCL and NEC all
other coal companies registered a positive growth in off-take. Off-take from CCL was
affected due to i) strike by contractor's workers, dismantling of Purnadih bridge as per
the order of High Court ii) stringent restrictions imposed by State Government to ensure
implementation of permissible carrying capacity causing resentment among the contractors
and their reluctance to execute the contract iii) Naxalite/Extremists restricted loading
from Tori siding for a considerable period of time and iv) frequent Bandhs / local
agitation. At WCL, unprecedented heavy rain during monsoon had a devastating effect.
Damaged roads and bridges, inundation of open-cast mines, badly affected coal
transportation and off-take. Less lifting by MAHAGENCO-Power stations, MPEB-Sarni,
HPGCL-Panipat, GEB-Ukai etc. also led to the shortfall.
(b) Sectorwise dispatch of coal & coal products:-
Sector-wise break-up of dispatch of coal and coal products during 2013-14 against
target and last year's actuals are given below:-
Figs. in million tonnes
Growth over Last Year
* despatch of washed coking coal and raw coking coal for direct feed, blendable coal to
steel plants and to external washeries. ** despatch to cement plants excluding cement cpp.
3.2 Dispatch of coal and coal products by various modes:-
Dispatch of coal and coal products during 2013-14 went upto 471.48 million tonnes from
466.21 million tonnes registering a growth of 1.1 %. Overall despatch by non-rail mode had
been almost 104% of the target. Growth in despatches via rail mode was 3.3 % whereas
overall non-rail mode it went down by 1.4 % compared to previous year. Movement by MGR was
at par with last year. The performance could have been even better, but for less movement
through MGR at ECL, NCL, MCL and WCL. Road dispatch of CIL was more than the target set.
Dispatch of coal and coal products by various modes for the years 2013-14 and 2012-13
are given below:
(Figs. in million tonnes)
Growth over Last Year
3. 3 Wagon Loading
Overall wagon loading materialization was 90.3 % of target. This was achieved due to
sustained efforts and regular coordination with railways at different levels. The increase
in loading over last year was of 6.12 rakes per day. Company wise performance showed that
ECL, NCL and SECL had exceeded last year's level of loading and almost achieved their
target. Also, Rake loading performance was more than last year at BCCL, WCL and MCL.
(Figs. in Rake/day)
Growth over last year
Note: Due to revision of wagon loading figures submitted by Railway Board, Kolkata and
WCL, Nagpur for the year 2012-13 - the loading is shown as 184.04 rakes/day, instead of
186.4 rakes/day. The difference was caused due to inclusion of non-CIL loading by Railways
in the loading figures of WCL which was subsequently corrected by Railways and CIL.
The loading would have been more but for the following reasons:
Cyclone 'Phailin' followed by devastating rainfall in October' 2013.
At ECL, regulated lifting by many power utilities like WBPDCL, NTPC, DPL and
RGTP-Hissar etc either, due to high stock at TPS end or non-payment of advance coal values
as per terms of FSA and frequent railway restrictions due to movement of imported
At CCL, Naxalite/Extremists restricted loading from Tori siding for a
considerable period of time; frequent bandhs/ local agitation and regulated lifting by
HPGCL power stations.
At NCL, regulated lifting by HPGCL, RRVUNL and Rajghat TPS and non-payment of
advance coal values as per terms of FSA by the Power Stations.
At WCL, less lifting by MAHAGENCO-Power stations, MPEB-Sarni, HPGCL-Panipat,
At SECL, regulated lifting by GEB & RRVUNL.
At MCL, contractor's workers went on strike at S-3 and S-4 siding of Talcher
field during October'13-January'14 and restriction in transportation and loading activity
imposed by State Govt of Odisha from 11.00 AM to 3.30 PM during summer due to excessive
3.4 Consumer satisfaction
i) In order to ensure enhanced customer satisfaction, special emphasis has been given
to quality management. Steps were taken to monitor quality right at the coalface apart
from bringing further improvements in crushing, handling, loading and transport system.
ii) CIL has built coal handling plants with capacity of about 296 MT per annum so as to
maximize despatches of crushed/sized coal to the consumer.
In addition, washeries at BCCL, CCL, WCL and NCL have adequate crushing/sizing
facilities of about 39.4 million tonnes.
iii) Measures like picking of shale/stone, selective mining by conventional mode as
well as by surface miners, adopting proper blasting procedure/technique for reducing the
possibility of admixture of coal with over-burden materials, improved fragmentation of
coal etc. are being taken for improving coal quality.
iv) Surface Miners have been deployed for selective mining at some of the mines to
improve the quality of coal. Action is being taken for deployment of more surface miners
in other mines where geo-mining condition permits. Already 56 Surface Miners have been
deployed in opencast mines and are wor