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Coal India Ltd

BSE: 533278 | NSE: COALINDIA ISIN: INE522F01014
Market Cap: [Rs.Cr.] 2,12,387.61 Face Value: [Rs.] 10
Industry: Mining / Minerals / Metals

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Director's Report


The Members,

Coal India Limited


Ladies and Gentlemen,

On behalf of the Board of Directors, I have great pleasure in presenting to you, the 41st Annual Report of Coal India Limited (CIL) and Audited Accounts for the year ended 31st March, 2015 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 manpower of 3,33,097 (as on 1st April, 2015). CIL operates through 82 mining areas spread over eight provincial states of India. Coal India Limited has 430 mines of which 227 are underground, 175 opencast and 28 mixed mines. CIL further operates 15 coal washeries, (12 coking coal and 3 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 other industries.

CIL has eight fully owned Indian subsidiary companies (direct):

Eastern Coalfields Limited (ECL),

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 viz. Coal India Africana Limitada (CIAL).

The mines in Assam i.e. North Eastern Coalfields is managed directly by CIL. Similarly, Dankuni Coal Complex is on lease with South Eastern Coalfields Limited.

MCL has three subsidiaries, namely MNH Shakti Ltd., MJSJ Coal Ltd. and Mahanadi Basin Power Ltd.

a. MNH Shakti Limited

MNH Shakti Ltd was incorporated on 16th July, 2008 as a Joint Venture Company of MCL. MNH Shakti Ltd had been formed for operation of Talabira OCP block where MCL is holding 70% share, Neyveli Lignite Corporation Ltd 15% share and Hindalco Industries Ltd. balance 15% share. The Share Capital of MNH Shakti Ltd. as on 31-03-2015 was Rs. 85.10 Crore. The Hon’ble Supreme Court of India in its judgment dated 25.08.2014 and order dated 24.09.2014 declared allocation of Talabira – II and Talabira – III coal blocks allocated to MNH Shakti Ltd. as illegal and has quashed the allocation.

b. MJSJ Coal Limited

MJSJ Coal Ltd was incorporated on 13th August, 2008 as a Joint Venture Company of MCL. MJSJ Coal Ltd had been formed for operation of Gopalprasad OCP where MCL is holding 60% share, JSW Steel Limited and JSW Energy Limited 11% share each and Shyam Metalics and Energy Ltd (formerly known as Shyam DRI Power Limited) and Jindal Stainless Limited 9% share each. The paid up Share Capital of MJSJ Coal Ltd. as on 31-03-2015 was Rs. 95.10 Crore. The Hon’ble Supreme Court of India in its judgement dated 25.08.2014 and order dated 24.09.2014 declared allocation of Utkal-A coal block allocated to MJSJ Coal Ltd. as illegal and has quashed the allocation.

c. Mahanadi Basin Power Limited

Another Company "Mahanadi Basin Power Limited (MBPL)" was incorporated on 2nd December, 2011 and certificate for commencement of business issued by ROC on 06-02-2012. MBPL had been formed as an SPV with wholly owned subsidiary of Mahanadi Coalfields Ltd for power generation of 2x800 MW through Pit Head Power plant at Basundhara Coalfields. The Share Capital of Mahanadi Basin Power Limited as on 31-03-2015 was Rs. 5 Lakhs.

Subsidiaries of SECL

SECL had incorporated 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 expeditious evacuation of coal.


a. CIL achieved a production of 494.24 MT of coal, removed 886.53 MM3 of OB and achieved an off-take of 489.38 MT with a growth of 6.88%,9.92% & 3.77% respectively compared to the last year.

b. All subsidiaries achieved a growth in production compared to the last year. There was an impressive growth in OB removal during 2014-15. Except MCL, all other subsidiaries had achieved a growth in OB removal. The negative growth in MCL was on account of land acquisition problems. All subsidiaries other than BCCL had achieved a growth in off-take compared to the last year. The negative growth in BCCL was due to less supply of wagons.

c. ECL came out of BIFR. BCCL was awarded Mini Ratna status.

d. Government of India divested further 10% of its holding in CIL in January 2015. An amount of Rs. 22,557 crores was realized. This was the highest divestment amount received by the GoI by selling its stake in any company till date.

e. CIL Board had approved 7 Coal Projects having an annual capacity of 73.42 MT.

f. Project Report for setting up of Super Critical Thermal Power Project (2X800MW) at MCL namely Mahanadi Basin Power Limited was approved by CIL Board.


2.1 Financial Results (CIL consolidated)

CIL is one of the largest profit making and tax & dividend paying enterprises. CIL and its subsidiaries had achieved an aggregate pre-tax profit of Rs. 21,583.92 crores for the year 2014-15 against a pre-tax profit of Rs. 22,879.54 crores in the year 2013-14.

(Rs. in crores)

Company 2014-15 2013-14
(CIL subsidiaries/ CIL standalone) Profit Profit
ECL (+) 1782.41 (+) 1299.28
BCCL (+) 1154.22 (+) 2089.01
CCL (+) 2740.34 (+) 2525.87
NCL (+) 3713.47 (+) 3355.71
WCL (+) 544.79 (+) 325.86
SECL (consolidated) (+) 5659.46 (+) 7202.40
MCL (consolidated) (+) 5314.24 (+) 5429.08
CMPDIL (+) 39.33 (+) 34.60
CIL (standalone) (+) 13651.89 (+) 15420.47
Sub-Total (+) 34600.15 (+) 37682.28
Less: Dividend from Subsidiaries (-) 13011.72 (-) 14406.82
Total (+) 21588.43 (+) 23275.46
Adjustment for exchange rate variation on Current Account of overseas subsidiary (+) (4.51) (+) 0.72
Adjustment for waiver of accrued interest of BCCL - (-) 396.64
Overall Profit as per Consolidated Accounts (+) 21583.92 (+) 22879.54

CIL as a group had achieved a post tax profit of Rs. 13,726.70 crores in 2014-15 (excluding share of minority loss of Rs. 0.09 crore; previous year Rs. 0.04 crore) as compared to Rs. 15,111.67 crores in 2013-14.

Highlights of performance

The highlights of performance of Coal India Limited including its Subsidiaries for the year 2014-15 compared to previous year are shown in the table below:

2014-15 2013-14
Production of Coal (in million tonnes) 494.24 462.42
Off-take of Coal (in million tonnes) 489.38 471.58
Sales (Gross) (Rs./Crores) 95434.76 89216.86
Capital Employed (Rs./Crores) Note- 1 76554.91 74891.87
Capital Employed (Rs./Crores)- excluding capital work in progress and intangible assets under development. 71395.54 70576.06
Net Worth (Rs./Crores) (As per Accounts) 40343.33 42391.86
Profit Before Tax (Rs./Crores) 21583.92 22879.54
Profit after Tax (Rs./Crores) 13726.70 15111.67
PAT / Capital Employed (in %) 17.93 20.18
Profit before Tax / Net Worth (in %) 53.50 53.97
Profit after Tax / Net Worth (in %) 34.02 35.65
Earnings Per Share (Rs.) (Considering Face Value of Rs.10 per share) 21.73 23.92
Dividend per Share (Rs.) (Considering Face Value of Rs.10 per share) 20.70 29.00
Coal Stock (Net) (in terms of No. of months Net Sales) 0.79 0.72
Trade Receivables (Net) (in terms of No of Months of Gross Sales) 1.07 1.11


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 2014-15, a sum of Rs. 2578.50 crore was transferred to General Reserve out of CIL (Consolidated) profits. This includes transfer of Rs. 1338.34 crore out of CIL (Standalone) profits.

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) company which is listed and 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 of 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 crore

Company (paying subsidiaries) Dividend Income of CIL (standalone)
2014-15 2013-14
CCL 530.05 1009.37
NCL 4563.99 2746.12
WCL 134.29 194.60
SECL 3941.57 3444.63
MCL 3841.82 7012.10
Total 13011.72 14406.82

During the year Coal India Limited (standalone) has paid a total dividend (by way of interim dividend) of Rs. 13074.88 crores @ Rs. 20.70 per share (Rs. 18317.46 crores @ Rs. 29.00 per share) on 6316364400 number of Equity Shares of Rs. 10/- each fully paid up. Out of above total dividend, the share of Govt of India was Rs. 10414.14 crores and for other shareholders, Rs. 2660.74 crores. (Previous year - Govt of India - Rs. 16485.71 crores and other shareholders – Rs. 1831.75 crores)

2.3 Observation of the Statutory Auditors

The Statutory Auditors have given their observations on the standalone and consolidated accounts of the Company for the year ended 31st March’2015. The Auditors’ observations in terms of Section 134(3)(f)(i) of the Companies Act’2013 and Management Explanation are enclosed as Annexure-V and Annexure-XV(B).


3.1 (a) Off-take of Raw Coal

Off-take of raw coal continued to maintain its upward trend and reached 489.377 million tonnes for fiscal ended March 2015, surpassing previous best of 471.581 million tonnes achieved during the last year, i.e., an increase of 3.8 % over the last year. The overall raw coal off-take achieved was 94.1 % of the Annual Action Plan Target.

Company-wise Coal Off-take:

Company-wise target vis--vis actual off-take for 2014-15 and 2013-14 are shown below:

Fig in Mill.Tonnes

2014-15 2013-14 Growth over last year
Company AAP Target Achieved % Achieved Achieved Abs. %
ECL 38.000 38.470 101.2 36.255 2.215 6.1
BCCL 35.000 33.672 96.2 34.200 -0.528 -1.5
CCL 58.000 55.338 95.4 52.122 3.216 6.2
NCL 78.000 73.693 94.5 72.111 1.582 2.2
WCL 45.000 41.246 91.7 39.945 1.301 3.3
SECL 133.000 123.223 92.6 122.027 1.196 1.0
MCL 132.000 123.003 93.2 114.344 8.659 7.6
NEC 1.000 0.732 73.2 0.577 0.155 26.9
CIL 520.000 489.377 94.1 471.581 17.796 3.8

From the above, it may be seen that ECL had not only exceeded its target but also achieved a positive growth compared to the last year. Barring BCCL, all other coal companies had registered a positive growth in off-take.

Off-take suffered mainly due to:

• Transportation constraints resulting from seizure of transport trucks for election purposes in almost all the coal companies during the General Election in the First Quarter.

• Major accident near Latehar affecting traffic movement in Mughalsarai section for 3 days during September’14.

• Production constraint and ageing infrastructure caused frequent CHP breakdown at various projects at NCL, delay in renewal of transportation contracts at the coal companies, Local agitation / Law & order problem at CCL/ MCL.

• Restriction in transportation at MCL during 11AM to 3 PM by Odisha Govt, in the months of May-June.

• Restriction imposed by District Administration for transportation of coal between 9.00 AM to 5.00 PM resulting in loss of 4 to 5 rakes per day at MCL-Ib Valley.

• Inadequate availability of wagons at MCL-Ib Valley, SECL-Korba and at ECR-served sidings of BCCL/CCL. Coal transportation constraints at SECL due to the delay in finalization of ESM contracts & transportation constraints at WCL.

• Heavy rain during monsoon and effect of Cyclone Hud-Hud at NCL, MCL and CCL during October’14.

• Strike by Trade Union affecting off-take & loading during January’15 and railway restriction for up-country movement / inadequate availability of wagons during the 4th quarter.

(b) Sector wise dispatch of coal & coal products:

Sector-wise break-up of dispatch of coal & coal products in 2014-15 against the target and last year’s actual is given below:

(Figs. In million tonnes)

Year 2014-15 2013-14

Growth over Last Year

Sector AAP Despatch % Satn. Actual Abs. %
Power (Util) 404.376 385.395 95.3 353.830 31.565 8.9
Steel * 3.265 3.771 115.5 3.658 0.113 3.1
Cement** 7.200 5.550 77.1 5.455 0.095 1.7
Fertilizer 2.425 2.292 94.5 2.287 0.005 0.2
Export 0.000 0.007 - 0.000 0.007 -
Others*** 101.527 92.967 91.6 106.254 -13.287 -12.5
Despatch 518.793 489.982 94.4 471.484 18.498 3.9

* despatch of washed coking coal & raw coking coal for direct feed, blendable coal to steel plants & to external washeries.

** despatch to cement plants excluding cement cpp.

***others include despatches under e-auction

In order to cater to the enhanced requirement of power sector due to decrease in stock at power plants and increase in number of power plants carrying critical coal stock, quantity offered through e- auction was regulated leading to negative growth in other sector.

3.2 Dispatches of coal and coal products by various modes

Dispatches of coal and coal products during 2014-15 went upto 489.982 million tonnes from 471.484 million tonnes registering a growth of 3.9 %. Overall dispatch by Non-Rail mode had been almost 101% of the target. Growth in despatches via Rail mode was 2.7 % whereas in the overall Non-Rail mode it increased by 5.4 %. Road despatches increased by 8.2% over the previous year. Movement by MGR was 1.5% above the last year.

Dispatch of coal and coal products by various modes for the years 2014-15 and 2013-14 is given below:

(Figs. In million tonnes)

Year 2014-15 2013-14 Growth over Last Year
Mode AAP Target Despatch % Satn. Actual Abs. %
Rail 297.587 266.499 89.6 259.410 7.089 2.7
Road 116.066 122.099 105.2 112.813 9.286 8.2
MGR 94.320 90.073 95.5 88.750 1.323 1.5
Other Modes 10.820 11.311 104.5 10.511 0.800 7.6
Overall 518.793 489.982 94.4 471.484 18.498 3.9

3. 3 Wagon Loading

Overall wagon loading materialization was 89.1 % of the target. This was achieved due to sustained efforts and regular coordination with railways at various levels. The increase in loading over the last year was of 4.3 rakes per day. Company-wise performance showed that WCL achieved its target. ECL, BCCL, CCL, WCL, MCL &NEC exceeded last year’s level of loading.

(Figs. In Rake/day)

2014-15 2013-14 Growth over last year
Company AAP Target Achieved % Achieved Achieved Abs. %
ECL 18.9 18.2 96.3 18.0 0.2 1.1
BCCL 24.9 22.3 89.6 22.2 0.1 0.5
CCL 32.8 25.4 77.4 25.2 0.2 0.8
NCL 23.0 20.4 88.7 20.9 -0.5 -2.4
WCL 15.7 16.1 102.5 15.7 0.4 2.5
SECL 39.3 31.8 80.9 34.3 -2.5 -7.3
MCL 62.6 59.8 95.5 53.5 6.3 11.8
NEC 0.96 0.65 67.7 0.43 0.22 51.2
CIL 218.2 194.5 89.1 190.2 4.3 2.3

Wagon loading suffered mainly due to intermittent law and order problem at CCL and MCL, delay in finalization of ESM road transport contracts at SECL, transportation constraints at WCL and CHP problem at various projects of NCL.

3.4 Consumer satisfaction

i. In order to ensure enhanced customer satisfaction, special emphasis was given to quality management. Various steps are 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 for a capacity of about 296 MT per annum so as to maximize dispatches of crushed/sized coal to its consumers. In addition, Washeries at BCCL, CCL, WCL and NCL have adequate crushing / sizing facilities to the tune of about 36.8 million tonnes.CIL has also initiated action to establish 15 more coal washeries with combined capacity of 112.6 Mty.

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 possibilit

Futures & Options Quote
Expiry Date :
363.90    [12.90] ([3.42]%)
Instrument: FUTSTK
Expiry Date: 31-Jul-2014
Open Price: 376.55
Average Price: 366.57
No. of Contracts Traded: 7,363
Open Interest: 93,92,000
Underlying: COALINDIA
Market Lot: 1,000
Previous Close: 363.90
Day's High | Low: 377.80 | 362.80
Turnover (Cr.): 269.91
Open Int. Change: 0,23,70,000 ([20.15]% )
Key Information

Key Executives:

R Mohan Das , Director (Personnel)

M Viswanathan , Company Secretary

Nagendra Kumar , Director (Technical)

BK Saxena , Director (Marketing)

Company Head Office / Quarters:

Coal Bhawan 3rd Floor Core-2,
Plot AF-III New Town Rajarhat,
West Bengal-700156
Phone : West Bengal-91-33-23246526 / West Bengal-
Fax : West Bengal-91-33-23246510 / West Bengal-
E-mail : complianceofficer@coalindia.in
Web : http://www.coalindia.in


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