eimco elecon india ltd share price Management discussions




This FY 2022-23, Coal India Limited the largest coal producer in India, could increase their production over 13 percent (to 703 MT against 622 MT in 2021-22). On the other hand Singareni Collieries Company Limiteds annual production improved marginally over the last FY to 67 MT against 65 MT. Captive and commercial coal blocks produced 121 MT as against 91 MT last FY.

For the FY 2022-23, total coal and coke imports increased by around 6 percent over last FY. Thermal coal imports were driven by an upstick in demand from utilities as power demand surged due to a resurgence in industrial activities following the easing of covid related restrictions.

However to reduce coal import bill the Coal mining industry needs to enhance its capacity rapidly. In fact the captive coal blocks already allocated were also taken at unreasonably high price and therefore, they are either not working or working at the lowest possible capacities. In 2019, our Parliament passed a bill that removed end- use restrictions for participating in coal mine auctions and open up the coal sector fully for commercial mining by domestic and global companies. The government offered major rebates on revenue share to winners of commercial coal block auctions in order to draw investments from local and global miners. So far 87 coal blocks have been successfully auctioned with peak rated capacity of 220 MT / year. Out of these 49 have been actually allocated so far (till 31.03.2023). Further, 106 coal blocks have been identified for next round of auctions.


Our equipment demand largely depends on the underground coal mining expansion. The growth in underground production was stagnant due to higher cost of mining, however now the technology upgradation to blast free technology will open up new avenues for us. Also the introduction of high capacity underground loaders for the Metal mines will add to our revenues. The renewable energy uses and alternate fuels are growing in India but the demand increase in power sector is much higher to be compensated by them only. The use of electrical automotive may further accelerate the demand for coal. Our steel sector also has more growth potentials and the coal demand for them also will be in the rising trend.


Coal is the largest source of electricity in the India. Thermal power plants generate 70% of Indias electricity. This, combined with the growth of coal-consuming industrial sectors like steel, is why the solid fuel source will continue to be integral to Indias economy in the next couple of decades. This is despite the governments ambitious plans to increase generation of renewable energy.

In the underground mining sector, the coming days will witness increase in demand for equipment catering to blast-free technology in underground coal mines and bigger size loaders and low profile dump trucks in the metal mines namely Zinc, Copper and Uranium.

There has been the spectacular rise of the mine development operator (MDO) mode of mining. Subcontracting of mine operations has been a major feature of the coal industry for more than two decades now. It has also brought considerable financial and operational efficiencies to Coal India.

There has been considerable increase in overall coal production in Coal India Limited and The Singareni Collieries Company Limited. Also, there has been steady increase in production from blast free technology in underground coal mining. Several tenders have been finalised/ to be finalised by the subsidiaries of Coal India Limited and several projects are in the pipeline.


Intermediate technology continues to be the backbone of underground production with around 65 percent of the total underground production being met by SDLs and LHDs. Our indigenously developed CM package is under trial and will be established in the coming days. Our bigger size LHD of 7 Tone and 10 Tone capacities have been established successfully.


The Government ‘Vision Plan 2030 proposed an action plan to become a manufacturing and export hub for construction equipment and propel the development of world-class infrastructure in the country. The general atmosphere for infrastructural development in the country is conducive to growth in Construction & Mining activities.

The highly ambitious National Infrastructure Pipeline (NIP) with an investment lay-out of INR 111 Trillion for FY 2020-25 is a first-of-its-kind, whole-of-government exercise, to provide world-class infrastructure to citizens and improving their quality of life.

‘Infrastructure & Investment is one among 7 priorities named ‘SaptrishiRs in Union Budget 2023-24. A Big Pie of INR 75,000 Cr allocation for PM Gati Shakti Master Plan - multi-modal connectivity for the states with focus on Roads, Railways, Airports, Ports & Waterways, with 100 Critical Infrastructure Gap Projects in 2023-24 would provide tremendous push for infrastructure development in the country, which also will be the major growth drivers for construction equipment industry.


The Government of India has made infrastructure creation a major pillar for sustainable growth. The initiatives of the present Government in promoting domestic players through ‘Make in IndiaRs initiatives has encouraged many domestic & international players to invest in Infrastructure Equipment Industry.

Your company has also taken the lead by manufacturing Piling Rig, which is a high end engineering product used for cast-in place piles, diaphragm walls & foundation reinforcement of buildings. These machines will find its market in all major Infrastructure Projects like Road or Railway Over Bridges, High Rise Buildings, Dams, Metros & other Infrastructure Structures. One of the companys recent products is the EC 216 Piling Rig, which is the first Indian-made completely indigenized Piling Rig under ‘Make in IndiaRs in technical collaboration with CZM from USA. It has started showing signs of acceptability by Indian Market due to its better performance over its rivals. Your company is going to add more Models of Piling Rigs in the forthcoming/impending Financial Year to increase the Offered Product Bouquet to Indian Buyers.


With a focus on Infrastructure development to promote growth with increased fund allocation & accelerated pace of construction, there will be an opportunity for various construction equipment including Piling Rig. The technologically advanced Rig with unique features has started consolidating its market place in presently Imported Equipment Market. Product acceptability among the users will further consolidate our foot prints in the country.

A few local players are also planning to enter Piling Rig manufacturing which may lead to addition of competition in the field. With higher market reach, focused customer service & quality consciousness there will be a scope to strengthen our product positioning against competition.


The main risk and concern of the Company remain that it will continue to depend more on Government clients for some more time till the private coal blocks for commercial and non-commercial usages attain their peak production capacities.


The Companys internal control systems are adequate, considering size and nature of operation of the Company, to meet regulatory /statutory requirements.


The Company attaches utmost priority to human resource development with focus on regular upgradation of the knowledge and skills of all employees and equipping them with the necessary expertise to meet the challenges of change and growth successfully. The company continuously monitors its manpower requirement to ensure that it has adequate human skills commensurate with its needs. Industrial relations of the Company continue to be cordial. As on 31st March, 2023, there were 127 permanent employees on role of the Company.


Pursuant to Schedule V(B) to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Key Financial Ratios along with detailed explanations are as follows:

No. Ratio 2022-23 2021-22
i. Debtors Turnover 3.71 1.65
ii. Inventory Turnover Ratio 1.20 0.68
iii. Interest Coverage Ratio 53.86 23.87
iv. Current Ratio 4.42 7.69
v. Debt Equity Ratio 0 0
vi. Operating Margin 13.90% 12.10%
vii. Net Profit Margin 11.39% 9.10%

The Annual Report has details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios as applicable, along with detailed explanations thereof is also part of this Annual Report.


Sales & Other income for the year ended 31st March, 2023 were 18,318.31 Lakh as compared to 9,362.58 Lakhs on 31st March, 2022. The net profit stood at 2,067.56 Lakhs (previous year 825.46 Lakhs).


Statements in this report on describing the Companys objectives, expectations or predictions may be forward looking statements within the meaning of applicable security laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could, however, differ materially from those expressed or implied.

The Company assumes no responsibility in respect of forward-looking statements herein which may undergo changes in future on the basis of subsequent developments, information or events.

For and on behalf of the Board of Directors,
Mukulnarayan Dwivedi Prayasvin B. Patel
Executive Director Executive Director
DIN :08442155 DIN :00037394
Place : Vallabh Vidyanagar
Date: 24th April, 2023