Gujarat Mineral Development Corporation Ltd Management Discussions

Economic Overview

The global economy continued to demonstrate resilience in FY 2024-25, navigating a complex landscape shaped by ongoing geopolitical uncertainties, fluctuating commodity prices, and the residual impacts of the COVID-19 pandemic. According to the International Monetary Fund (IMF), global growth for 2024-25 is projected at 2.8% 1 , reflecting cautious optimism amid stabilizing macroeconomic conditions in key economies such as the United States and China. Advanced economies sustained moderate growth, supported by resilient labour markets and consumer spending, with the U.S. and the Eurozone expanding by 1.7% and 1.4%, respectively. Key indicators with sparklines for the period 1980 to 2030, shows the future outlook of world economy.

India is currently the fourth largest and fastest-growing economy in the world. The Reserve Bank of India (RBI) has projected a GDP growth rate of 6.6% for FY 2024-25, driven by strong domestic consumption, rising industrial output, and sustained government investment in infrastructure. Policy initiatives under the Make in India programme and continued reforms to improve the ease of doing business have further strengthened investor confidence. Encouragingly, inflation trends remained contained within the RBIs target range, providing a stable monetary environment.

Despite the overall positive outlook, certain sectors faced persistent challenges. Volatility in global energy prices continued to affect cost structures, particularly for energy-intensive industries. The mining sector, vital to GMDC Ltd., grappled with demand fluctuations and evolving regulatory frameworks. Nevertheless, an increased emphasis on sustainable mining practices, technological integration, and policy support presents strategic opportunities for long-term growth. As the global and domestic economies progress through FY 2024-25, timely policy interventions and focused capital investments will be critical to sustaining momentum and leveraging emerging opportunities.

Global Economic Trends

Emerging markets and developing economies continued to display varied growth trajectories in FY 2024-25, with India maintaining its status as one of the fastest-growing major economies. This strong performance was fueled by resilient domestic demand, expanding industrial output, and sustained public expenditure on infrastructure and manufacturing-led initiatives. Across Asia and Africa, several emerging economies made notable contributions to global output, navigating persistent inflationary pressures and ongoing supply chain realignments. The World Bank highlighted that these economies sustained growth by leveraging young, growing workforces, and advancing structural and governance reforms.

However, global economic output remained constrained by volatility in energy markets and intermittent supply chain disruptions, especially in sectors reliant on critical raw materials. The International Energy Agency (IEA) noted sharp fluctuations in global energy prices, driven by geopolitical instability and climate-related disruptions, which affected production costs and macroeconomic stability. The mining sector, an integral part of global industrial supply chains, continued to grapple with regulatory shifts, unpredictable demand cycles, and growing scrutiny over environmental and social performance. Nonetheless, accelerated technological innovation and a global pivot towards sustainable practices opened up new opportunities for growth and resilience.

In FY 2024-25, the global mining sector underwent a period of strategic transformation, driven by the dual imperatives of supporting industrial growth and enabling the global energy transition. The demand for essential minerals and metals, particularly those critical to renewable energy, electric mobility, and digital infrastructure remained strong. However, the sector faced mounting pressure to reduce its environmental footprint and integrate ESG considerations into core operations. In response, mining companies increasingly adopted automation, cleaner extraction technologies, and circular economy principles. The World Bank reaffirmed the long-term relevance of the sector, projecting a substantial increase in demand for critical minerals by 2050, underpinning the global transition to low-carbon economies.

Coal mining, a key component of the extractives industry, continued to operate in a challenging and bifurcated landscape. In emerging economies, particularly India and China, coal remained a crucial component of the energy mix, driven by rising electricity demand, industrial requirements, and energy security considerations. Despite strong investment in renewables, both countries accounted for over two-thirds of global coal consumption in 2024, underscoring coals ongoing role during the transition phase.

On the other hand, the coal mining in advanced economies witnessed a continued decline due to aggressive climate targets, tightening environmental regulations, and decarbonization mandates. The United States and European Union made significant strides in reducing coal dependency, leading to mine closures and increased adoption of cleaner energy alternatives. This global divergence posed a dual challenge for the coal industry: to ensure stable and reliable coal supply in regions where it remains indispensable, while also aligning operations with sustainability goals and adapting to long-term shifts in global energy policy.

Indian Economy

In FY 2024-25, the Indian economy continued its strong growth trajectory, affirming its position as 4th largest economy in the world. The Reserve Bank of India (RBI) has projected a GDP growth rate of 6.6%, supported by resilient domestic demand, high infrastructure spending, and a positive investment climate. The government sustained momentum on structural reforms, with continued implementation of Production Linked Incentive (PLI) schemes driving growth in manufacturing, particularly in electronics, automotive, and renewable energy sectors. The year also witnessed a healthy uptick in foreign direct investment (FDI), especially in technology and high-value manufacturing, reflecting Indias growing appeal as a global investment destination.

Inflation management remained a key achievement during this period. Building on the progress of previous years, the RBI kept inflation largely within its target range of around 4%, aided by calibrated monetary policy and targeted government interventions to manage supply-side constraints in food and energy. The stability in inflation provided a supportive environment for sustained consumer confidence, private consumption, and overall macroeconomic resilience.

Indias labour market showed encouraging signs, with a gradual decline in unemployment and improved participation rates. Government initiatives like Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), along with expanding skill development and entrepreneurship programmes, played a vital role in generating employment across both rural and urban areas. The rise of digital platforms, gig work, and startup ecosystems also contributed to job creation, particularly among the youth. The ongoing formalization of the workforce, driven by increased adoption of digital payments, GST compliance, and labour code reforms, helped improve productivity, transparency, and financial inclusion.

Despite this positive backdrop, the Indian economy continued to face structural challenges. Income disparity and rural economic vulnerabilities persisted, particularly due to erratic monsoon patterns and infrastructure gaps in agriculture-dependent regions. In response, the government stepped up investments in rural infrastructure, irrigation, and agri-tech solutions, aiming to enhance farm productivity and climate resilience. Welfare initiatives focusing on healthcare, education, and financial inclusion were further strengthened to uplift marginalized communities and ensure that growth remained inclusive and equitable.

India is well-positioned to maintain its upward momentum and strengthen its position in the global economy as it progresses through FY 2024-25 due to its policy emphasis on infrastructure development, digital transformation, and green growth as well as ongoing budgetary restraint.

Coal & Lignite Sector Perspective Production and Growth Overview

Indias coal industry delivered robust performance in FY 2024-25, recording a historic high of 1,047.69 million tonnes of coal production, reflecting a 5% year-on-year increase from 997.83 MT in FY 2023-24. This growth was primarily driven by enhanced output from Coal India Limited (CIL) subsidiaries such as Mahanadi Coalfields Ltd. (MCL) and Eastern Coalfields Ltd. (ECL), along with a significant contribution from captive and commercial blocks. Lignite production also showed consistency, with 45.29 MT produced and 44.29 MT dispatched during the fiscal year.

This increase in output was complemented by an ecosystem-wide push across exploration, infrastructure, policy, and innovation. Agencies like CMPDI and MECL stepped up regional and detailed exploration efforts, aided by enhanced coordination through the Ministry of Coal under the Exploration of Coal and Lignite Scheme.

The past decade has seen India become a power sufficient nation from a supposed power-deficit country. This progress reflected the increase in generation capacity from 276 GW to 475.20 GW, a 72.17% overall increment in installed capacity. Most of this increased capacity is fossil fuel-based, with coal accounting for the largest share at 45.7% of the total installed generation capacity.

The year-on-year increase in generation capacity has been tremendous, with total electricity generation rising from 624.20 billion units in 2005-06 to 1,823.89 billion in 2024-25. The larger component of said generation are fossil fuel based with 1363.54 billion units. However, the highest compound annual growth rate(CAGR) is in Non-Fossil fuel based generation, which is at 11.80% for the year of 2024-25.

The revised SHAKTI policy introduced flexible allocation through 3, 6 and 12 month windows, enabling thermal plants to secure coal more reliably. New rules also allow Independent Power Producers (IPPs) to sign long-term coal contracts without having to tie them to power purchase agreements (PPAs). Meanwhile, CIL has dropped quantity limits, allowing plants to buy as much coal as they need for operations.

On the clean energy front, India launched its first Underground Coal Gasification trial at the Kasta block in Jharkhand. Additionally, a Rs8,500 crore incentive scheme was rolled out to support coal and lignite gasification, offering a 50% revenue rebate for projects that channel at least 10% of coal output into gasification.

A new Integrated Coal Logistics Policy is now guiding multimodal transportation and First-Mile Connectivity via conveyors to silos, reducing delays and dust pollution. In line with environmental goals, updated mine closure rules now require restored land, tree planting, and habitat protection once mining ends.

Lastly, to ensure domestic supply security, coal-based electricity can only be exported when the coal is sourced through imports, commercial mining, or spot e-auctions.

Bauxite Sector Perspective

Indias bauxite production reached approximately 23.9 million tonnes in FY 2024-25, continuing its steady growth trajectory with an annual CAGR of ~1.7%. Major producing states like Odisha, Gujarat, and Jharkhand remained key contributors, supporting both domestic industries and export commitments. The government, through the Indian Bureau of Mines and allied agencies, has ramped up exploration and policy support, unlocking new reserves while reinforcing environmental safeguards. With increasing demand from the Aluminium and infrastructure sectors, India is actively expanding its refining capacity and downstream manufacturing capabilities. Looking ahead, the bauxite sector will observe strong growth, driven by integrated value chain development from mining to alumina refining and Aluminium fabrication. A shift toward value-added products, rising export potential, and focus on sustainable mining are setting the stage for India to emerge as a global leader in the Aluminium ecosystem.

Government Policy Landscape in 2024-25 Exploration initiatives by Govt

The Ministry of Coal continues its Exploration of Coal & Lignite initiative (2021-26) with a revised allocation of Rs2,980 crore. This includes Rs1,650 crore for promotional/regional exploration and Rs1,330 crore for detailed drilling in non-Coal India Limited areas, aimed at bolstering domestic coal and lignite reserves.

Revised SHAKTI Policy For Coal Allocation

In May 2025, the government approved a revised SHAKTI policy (Scheme for Harnessing and Allocating Koyala Transparently in India), streamlining coal linkages to power plants via transparent auctions. The amendments further liberalize coal mining and allocation frameworks, ensuring more efficient coal supply to the power sector.

Coal Logistics Plan and Policy

Launched in February 2024, this updated policy mandates a shift toward railway-based First-Mile Connectivity (FMC) systems to improve coal evacuation efficiency. With over 90% mechanized FMC infrastructure targeted by FY2030, the plan is expected to reduce rail logistics costs by ~14%, saving Rs21,000 crore annually and lowering CO2 emissions.

Digital Coal Trading Exchange

A new proposal to establish a domestic coal trading exchange was unveiled in March 2025. This platform will enable commercial miners, self-use producers, and public sector entities, including Coal India, to sell coal in a competitive, many-to-many marketplace, modernizing supply dynamics.

Mining Plan Guidelines 2024-25

In mid-2024, the Ministry introduced updated Mining Plan Guidelines for Coal & Lignite Blocks. These guidelines emphasize sustainable and ethical mining practices, mandatory mine closure planning, and the adoption of modern technologies and safety protocols.

Coal Gasification and Syn-Gas Schemes

The government continues incentives under its Coal Gasification and Underground Coal Gasification (UCG) policies, promoting syngas production and cleaner fuel alternatives. Recent developments (April - June 2024) include commercial-scale Surface Coal Gasification projects aimed at producing green-coal derivatives like methanol, ethanol, and urea .

Performance of GMDC Lignite

GMDC holds the distinction of being Indias leading merchant seller and the second-largest producer of lignite, significantly contributing to the industrial development of Gujarat, particularly within the MSME sector. Gujarat boasts rich deposits of high-grade lignite, and GMDC actively mines this resource in Bhavnagar, Tadkeshwar, Rajpardi (South Gujarat), Mata no Madh, and Umarsar (Kutch).

In FY 2024-25, GMDCs active lignite mines delivered a cumulative production of 8.02 million metric tonnes (MT), generating revenues of approximately Rs2,608 crore, marking a notable increase from 6.37 million MT and Rs2,250 crore in FY 2023-24. A significant turnaround was observed at the Tadkeshwar project, which resumed operations in November 2023 following a prolonged disruption caused by a landslide in December 2021. As a result, production surged to 6.20 lakh MT, up from just 31,000 MT in the previous year. Conversely, lignite reserves at Rajpardi were depleted, leading to a decline in dispatches to 1.14 lakh MT, compared to 3.92 lakh MT in FY 2023-24.

Additionally, lignite offtake from the Mata-no-Madh and Umarsar mines was impacted due to scheduled overhauls and revival activities at the ATPS and KLTPS power plants, resulting in consumption of only 1.08 lakh MT.

GMDC continues to play a pivotal role in supporting Gujarats industrial base by supplying lignite to key sectors including textiles, chemicals, ceramics, and brick manufacturing. Despite its relatively lower calorific value, lignite has emerged as a cost-effective alternative to blended fuels, offering substantial savings in transportation and contributing to a reduction in coal imports—supporting both industrial competitiveness and national self-reliance.

Driven by rising demand, especially from the MSME segment, GMDC is scaling its annual lignite production capacity from 8 MTPA to 10 MTPA. Currently, the company fulfills approximately 25% of Gujarats total demand, with ambitions to serve 30-35% of the states market in the near term.

To meet this objective, GMDC is in the process of operationalizing six new lignite mines, which will enhance production capabilities, reinforce market leadership, and strengthen integration across the mine-to-market value chain. These upcoming assets are expected to boost lignite availability, reduce electricity generation costs, and position GMDC to capture up to 50% of Gujarats lignite demand, while supporting captive power consumers and leveraging favorable market conditions.

Non-Coal

Bauxite

A significant portion of this revenue i.e., ~Rs105 crore was driven by the bauxite business, which emerged as a key contributor to the companys non-lignite portfolio. The bauxite segment, in particular, exhibited remarkable performance, registering 55% growth in volume and an impressive 45% growth in revenue, reinforcing its role as a high-potential business avenue.

Silica Sand

Silica sand sales have seen extraordinary growth, reaching 6.93 Lakh MT in FY25 - a staggering 257% year-on-year increase. This surge is particularly notable compared to previous years, with sales recorded at 0.75 Lakh MT in FY23 and 1.95 Lakh MT in FY24, demonstrating a steady upward trajectory. The Rajpardi projects halt in lignite dispatch has further underscored the importance of this revenue stream, with Rs9 crore from silica sand sales playing a crucial role in offsetting project costs. This remarkable expansion highlights the growing demand for silica sand and GMDCs ability to leverage opportunities beyond lignite.

Fluorspar

The fluorspar project underwent a successful revamp, with production resuming in FY25. While conducting trial run of the fluorspar beneficiation plant during the last financial year, GMDC sold 1,156 MT of fluorspar, generating Rs3 crore. Given the limited industrial presence within a 100-kilometre radius, the Ambadungar Fluorspar Mine and Kadipani Beneficiation Plant play a pivotal role in employment generation and economic empowerment. These facilities provide essential opportunities, particularly benefiting local tribal communities, by fostering sustainable development and strengthening the regional economy. The projects revival marks a significant step towards maximizing resource utilization while uplifting the surrounding communities.

Power

ATPS

GMDC marked a transformative year in FY 2024-25, spearheading several strategic and operational initiatives to strengthen its role in Gujarats energy landscape. One of the most significant undertakings was the launch of Project Disha in collaboration with external expert, focused on the turnaround of Akrimota Thermal Power Station (ATPS). Based on a comprehensive assessment, the company opted for an asset turnaround strategy aimed at restoring ATPS as a reliable power asset. With L&T-S&L serving as Project Management Consultant, GMDC engaged leading technical partners including Honeywell (for DCS and instrumentation upgrade), OEM Ansaldo and Power Mech Projects (for boiler, ESP, and turbine overhaul), and Macgele (for BOP systems). These partners were selected via a stringent quality-cum-cost-based process to ensure optimal performance outcomes. The project, now in its final stage, is expected to significantly enhance ATPSs operational reliability and financial viability, targeting over 80% plant availability. Once completed, ATPS is anticipated to supply consistent and efficient power, enabling industrial growth and community upliftment.

Operationally, GMDC achieved a power generation output of 88.129 million units (MU), with a Plant Load Factor (PLF) of 4.02%. The company undertook several measures to improve energy efficiency and sustainability, including investments in modern energy conservation equipment and alternative energy exploration. Steps were also taken to absorb cutting-edge technologies in plant operations, resulting in improved efficiency, cost optimization, and reduced environmental impact. These initiatives not only contributed to import substitution and product development but also reaffirmed GMDCs commitment to sustainability and innovation. As the company moves forward, its focus on strategic execution, technological advancement, and value-driven operations continues to position it as a key enabler in Gujarats energy and mining ecosystem.

Renewable

During FY 2024-25, the Companys renewable energy operations comprised wind and solar power projects with a total installed capacity of 205.9 MW, including 200.9 MW from seven wind projects and 5 MW from a solar project at Panandhro.

Wind

The wind projects generated a total of 320.92 million units (MU), achieving a plant load factor (PLF) of 18.24% and a machine availability (MA) of 90.82%, resulting in a total revenue of Rs122.70 crore and a profit of Rs38.59 crore. Among these, the Rojmal wind project delivered the highest generation of 88.28 MU with a PLF of 20.16%, contributing Rs36.33 crore in revenue and Rs15.91 crore in profit. The Adodar (Gorsar) project demonstrated the highest PLF at 26.74%, while Lathedi (Bada) was the only project to report a marginal loss.

Solar

In solar operations, the Panandhro solar plant generated 6.60 MU at a PLF of 15.14%, earning Rs 3.2 crore in revenue and a profit of Rs0.73 crore.

Quality Initiatives

In FY 2024-25, GMDCs Quality Control Department made significant progress in elevating mineral quality assurance through technological innovation, digitization, and skill development. Over 7,000 samples of lignite, bauxite, and fluorspar were analyzed with high precision to support operational and regulatory needs. A major highlight was the deployment of Nuclear Magnetic Resonance (NMR) spectroscopy for fluorspar analysis at the Kadipani project, enabling faster, non-destructive, and more accurate measurement of CaF2 content. Additionally, the Laboratory Information Management System (LIMS) was piloted across lignite sites, offering real- time data capture, improved traceability, and enhanced compliance.

To further strengthen capabilities, GMDC conducted specialized training programmes, upgraded laboratory infrastructure across major mining projects, and initiated new lab setups for upcoming coal, limestone, and copper projects. The department also emphasized standardization and performance monitoring through assessments and feedback mechanisms. Looking ahead, QC aims to expand analytical tools like AAS and XRF, secure NABL accreditation for key labs, and institutionalize continuous training. These initiatives reinforce GMDCs commitment to quality, transparency, and operational excellence while laying a strong foundation for supporting the companys growing and diversified mineral portfolio.

Exploration Activities

The company has been pursuing a crucial exploration assignment during the 2024-25 field season. One of its flagship initiatives is at the Ambaji Base Metal Mine near Ambaji town, North Gujarat, set to become the states first underground copper mine. Spanning nearly 184 hectares, GMDC has launched a two-phase core drilling programme aimed at boosting resource estimates in both brown- field and green-field zones. With a total plan of 49 boreholes and 24,000 meters of drilling, the project had completed 156 meters under Phase-I by March 2025. Early geological findings include formations such as quartzite and various schist types, while Phase-II drilling is expexted to begin shortly.

In addition to its focus on copper, GMDC is exploring enhanced resource utilization in its existing bauxite mines located in the Gadhsisa group in Kutch. These mines, which supply bauxite to various industries, are now also being investigated for their underlying bentonitic clay deposits. Areas like Wandh and Goniyasar have shown promising signs of high-value bentonite, leading GMDC to plan a drilling programme of 8 boreholes with a total depth of about 400 meters. This dual-mineral potential strengthens the regions economic mining feasibility and aligns with GMDCs broader goal of maximizing mineral resource utilization.

Further exploration has been carried out in lignite blocks located in Kutch and South Gujarat. Notably, the core drilling of 5,784.9 meters across 109 boreholes in blocks such as Bharkandam (Kutch), Valia (Bharuch), and Ghala (Surat) has been completed. These efforts aid effective conversion of resources into reserves while strengthening project economics. The exploration activities collectively enhance companys strategic mineral portfolio and reaffirm its commitment to resource-based growth in Gujarat.

New Frontiers - Pioneering Resource Leadership with Purpose

FY 2024-25 was a landmark year in GMDCs journey of strategic diversification and national value creation. Staying true to its legacy of powering Gujarats industrial growth, GMDC ventured into new geographies, minerals, and energy verticals with a balanced approach rooted in environmental stewardship, stakeholder trust, and forward-looking governance.

GMDC made steady progress during FY 2024-25. GMDC has signed a key Memorandum of Understanding with GUVNL to supply coal and lignite to power plants in Odisha and Gujarat, jointly adding an estimated 5.6 GW of Generation capacity. Gujarat Electricity Regulatory commission greenlit the amendment to GMDCs Power Purchase agreement with GUVNL which is expected to generate an additional Rs33 crore annually.

Each initiative taken this year is a testament to GMDCs growing role as an integrated resource organisation, supporting Indias vision of self-reliance, clean energy transition, and equitable development.

Copper Project - Unlocking High-Grade Resources

GMDCs exploration near Ambaji, Banaskantha, covering 184 hectares, is one of Indias most promising mining ventures. With 7.3 million tonnes of reserves containing Copper, Lead, Zinc, and trace elements like Silver, Cadmium, Germanium, and Selenium, this project is among the richest globally in metal concentration.

A beneficiation plant is proposed to recover multiple metal streams for electronics, transport, clean energy, and export markets. With stakeholder engagement and environmental planning underway, the project marks GMDCs formal entry into non-ferrous mining, aligned with Indias Atmanirbhar Bharat vision in strategic metals.

Odisha Coal Blocks - Scaling Beyond Gujarat

Under Project SHIKHAR, GMDC continued building a robust coal business in Odisha, with progress across three blocks i.e., Baitarni- West, Burapahar, and Kudanali-Lubri. The flagship project, Baitarni-West with over 1,000 million tonnes of geological reserves and a peak capacity of 15 MTPA, has achieved key milestones including Mining Plan approvals and Public Hearing.

Agencies have been mobilized for land acquisition, environment and forest clearance, and rehabilitation. These blocks will cater to Indias industrial energy needs and strengthen GMDCs diversified resource base beyond Gujarat.

New Lignite Mines - Reinforcing Gujarats Industrial & Energy Security

To ensure long-term lignite availability and replace depleting legacy mines, GMDC undertook its most ambitious lignite expansion yet comprising six new mining projects across Kutch and South Gujarat. These include Lakhpat, Panandhro Extension, Bharkandam, Ghala, Valia, and Damlai, collectively adding 482.9 million tonnes of reserves to Gujarats energy supply base.

All mines are at various stages of implementation, with mining contracts awarded, land acquisition underway, and phased development aligned with environmental protocols. This lignite pipeline will serve Gujarats MSME sector, reduce dependence on imported coal, and strengthen GMDCs role as a key contributor to the states energy resilience.

Limestone & Cement Sector Integration - Building Industrial Foundations

With over 800 million tonnes of cement-grade limestone reserves, GMDC deepened its forward integration strategy by signing a 40- year limestone supply agreement with JK Cement Ltd., enabling the development of a greenfield cement plant in Western Kutch.

In parallel, GMDC is finalizing partners under a national-level EOI for establishing a mega-scale cement unit, positioning itself as a long- term raw material partner in the building materials industry. This initiative creates multiplier effects in employment, industrialization, and royalty generation for the state.

Rare Earths & Critical Minerals - A National Strategic Imperative

As the world pivots toward energy storage, renewables, and digital technologies, the need for Rare Earth Elements (REEs) has become paramount. GMDCs Rare Earth initiative stands at the forefront of Indias critical minerals programme. The deposit under development holds Light Rare Earths critical for applications in EVs, wind turbines, and defense equipment.

What makes GMDCs approach distinct is its plan for an integrated beneficiation and downstream processing facility, creating a mine- to-magnet value chain. This initiative will reduce Indias REE import dependence while uplifting local communities through employment, environmental safeguards, and responsible mining practices. It reinforces GMDCs commitment to national self-reliance and global competitiveness.

Coal Gasification - A Cleaner, Value-Added Future

In keeping with Indias National Coal Gasification Mission, GMDC has initiated feasibility studies for coal and lignite gasification to produce cleaner fuels such as syngas, methanol, and hydrogen. This transition enables better environmental performance from

GMDCs existing fuel assets while unlocking new applications in fertilizers, petrochemicals, and power.

The initiative positions GMDC to be an early mover in future-ready industrial fuels, combining circular economy principles with energy innovation.

Renewable Energy - Greening Our Growth

FY 2025 marked the beginning of GMDCs entry into the renewable energy sector, with the Board approving a structured roadmap for solar and hybrid C&I power generation. A dedicated internal committee was set up to identify locations, structure SPV frameworks, and engage industrial power consumers for long-term partnerships.

GMDC plans to repurpose mined-out land for clean energy installations, creating synergies between land restoration and decarbonization. This initiative underscores GMDCs broader identity—from a mining PSU to a climate-aligned energy and resource enterprise.

Financial Performance

GMDC delivered a strong performance in FY 2024-25, achieving key financial milestones that underscore its operational resilience and effective execution of strategic priorities. The Company recorded its second-highest annual revenue from operations and the third- highest Profit Before Tax (PBT) in its history. The fourth quarter (Q4) also closed on a high note, ranking third highest in both operational revenue and PBT on a quarterly basis.

Key financial highlights for FY 2024-25:

• Total revenue stood at Rs3,204 crore, registering a 17% increase over FY 2023-24.

• EBIDTA reached Rs992 crore, reflecting an 11% year-on-year growth, driven by efficient cost management and sustained margins.

• Profit Before Tax (PBT) rose to Rs897 crore, marking a 10% increase over the previous year, showcasing strong core business performance.

• Profit After Tax (PAT) stood at Rs688 crore, a 12% year-on-year growth, further affirming GMDCs financial robustness.

Opportunities

In FY 2024-25, GMDC continued to benefit from a strong net worth base, healthy profitability, ample internal accruals. Majority ownership by the Government of Gujarat provides strategic stability and operational facilitation, especially for approvals in core mining operations. The six lignite mining leases positions GMDC to significantly increase production volumes in coming years. This comes at a time when demand for domestic lignite remains high, driven by volatility in international coal markets.

Geographic and mineral diversification has progressed strongly. GMDCs expansion into coal mining in Odisha through the Burapahar and Baitarani (West) blocks adds long-life assets (totaling over 1,600 million tonnes in reserves), positioning the company for sustainable growth beyond Gujarat. Furthermore, GMDCs limestone reserves at Lakhpat Punrajpar, Bharkandam, and Panandhro Extension are being commercialized through engagement with cement producers for long-term supply partnerships. The companys emerging projects in copper exploration at Ambaji and rare earth elements (REEs) present high-potential opportunities to align with Indias strategic minerals agenda and green energy transition.

Threats

GMDC faces multiple external and sectoral risks. Key among these are global commodity price volatility, regulatory uncertainties in coal mining, and increasing environmental and sustainability expectations. As GMDC scales up coal operations in Odisha, there are risks of delays in land acquisition, statutory clearances, and project execution due to unfamiliar operational terrain. Moreover, as India aggressively pursues decarbonization and energy transition, there may be structural pressures on traditional fossil fuel segments, including lignite and thermal coal.

The capital expenditure required for mining expansion, technology integration, and rehabilitation across newly acquired blocks is expected to put pressure on near-term free cash flows, despite funding being planned largely through internal accruals. Additionally, emerging competition from imported coal and regulatory scrutiny on environmental compliance could impact long-term competitiveness, unless mitigated by sustainable practices and innovation.

Outlook

GMDC remains well-positioned to sustain its leadership in lignite mining while building a diversified portfolio of future-facing minerals. The company is accelerating the operationalisation of six newly allocated lignite blocks, along with the setup of a lignite beneficiation plant to enhance material quality and efficiency.

Significant progress has also been made in revamping the Akrimota Thermal Power Station (ATPS), with operational improvements expected to materialize in FY 2026. This will not only improve plant performance but also contribute to improved energy reliability and revenues.

Looking ahead, GMDCs copper exploration initiative at Ambaji is a major milestone in venturing into the base metals segment. With growing demand for copper driven by electric mobility, renewables, and infrastructure, this initiative is aligned with national priorities and global trends. Additionally, the company is actively assessing the potential for rare earth element (REE) recovery from selected deposits, supporting Indias goal of reducing dependence on imported critical minerals. Pilot studies and partnerships are being explored to tap this strategic segment.

At the Burapahar coal block, GMDC is planning to implement a coal gasification project to extract syngas for use in power and chemical industries. This forward-looking initiative aligns with national goals to promote cleaner coal technologies and add value to indigenous coal reserves. The project is currently in the feasibility and planning stage, with long-term potential to position GMDC as a contributor to Indias clean energy ecosystem.

Through these integrated strategies, GMDC aims to balance traditional strengths with forward-looking growth opportunities—ensuring resilience, sustainability, and stakeholder value creation in an evolving resource landscape.

Risks and Concerns

Risk is an intrinsic aspect of the mining and minerals industry, and GMDC is no exception. Rather than viewing risks solely as threats, the company recognizes them as potential opportunities that, when managed proactively, can enhance stakeholder value and drive sustainable growth.

As of FY 2024-25, GMDC faces heightened resource sustainability risks. The companys current operational lignite mines have reserves of approximately 119 million tonnes. Notably, the Rajpardi mine, historically known for its superior-quality lignite, has become non- operational due to unforeseen geotechnical challenges. Production at Rajpardi plummeted from 3.92 lakh MT in FY 2023-24 to just 1.14 lakh MT in FY 2024-25, significantly underperforming against the budgeted target of 7 lakh MT. Although operations resumed in November 2023 following Board approval to mine in the barrier zone, a major slope failure disrupted activities and forced an indefinite halt. This setback not only impacted supply chain reliability but also dealt a critical blow to GMDCs short-term production strategy.

The exhaustion of other key mines, such as Mata No Madh (expected within 3 - 4 years), further underlines the urgency of developing newly allocated mines to ensure continuity of supply. GMDC has been allocated six lignite blocks and three coal blocks (Burapahar, Baitarani West and Kudanali) in Odisha. While these assets promise long-term value, they also present significant execution risks:

• Environmental and forest clearance delays remain a primary bottleneck.

• Land acquisition is increasingly complex under the current regulatory landscape, impacting both cost and timelines.

• Infrastructure limitations, particularly logistics for evacuation, could restrict timely coal monetisation.

The planned coal gasification project at Burapahar represents a strategic move toward cleaner energy and value addition but introduces new risks related to technology feasibility, capital intensity, and market off-take viability.

GMDCs recent diversification into copper and rare earth elements (REEs) is aligned with Indias strategic push for critical minerals. However, these sectors carry exploration, regulatory, and commercialisation risks, as GMDC builds capabilities and partnerships in relatively uncharted domains.

Broader macro and policy risks persist:

• Global commodity price volatility (across lignite, coal, base and critical minerals) could significantly affect earnings.

• Geopolitical and trade disruptions may alter raw material flows or impact input costs.

• The accelerated transition to renewable energy threatens long-term demand for coal and lignite, prompting a strategic pivot towards sustainability-focused mining practices.

• In addition, environmental liabilities and restoration responsibilities are increasing as GMDC expands its operational footprint. This includes rehabilitation and closure costs, afforestation, water table management, and biodiversity offsets. Complying with growing ESG expectations will require enhanced investments in environmentally friendly technologies and transparency systems.

Social concerns such as displacement, local community engagement, and equitable development are particularly acute in newly explored states like Odisha. Proactive and inclusive stakeholder management will be vital to ensure project continuity and social license to operate.

Despite these challenges, GMDC remains well-positioned both, financially and operationally, to navigate risks. With strong cash flows, and government support, GMDC continues to pursue strategic expansion while managing risk through disciplined project evaluation, robust governance, and adaptive planning.

Internal Control and Adequacy

The company has a robust multi-tiered audit framework to ensure financial integrity and procedural compliance. Internal audit system provides in-depth insights into financial and procedural practices across various projects. Internal auditors report directly to the Audit Committee, ensuring independence and transparency. In addition to the internal audit, the company performs pre-audit reviews of all financial proposals before approval, reinforcing checks at the departmental level through maker-checker protocols and in-built payment validations.

To support strategic financial decision-making, the company has implemented a strong budgetary control system that monitors quarterly and annual expenditures. This helps the management take informed decisions on major financial outlays. The Audit Committee plays a central role by regularly reviewing audit findings, assessing quarterly performance, and overseeing all auditor appointments. These discussions and reviews help ensure alignment with financial governance and compliance standards before reporting to the Board.

Being a government entity, the company is subject to external audits by the Comptroller and Auditor General (CAG) of India. This includes both supplementary and propriety audits. The supplementary audit is conducted annually, and CAGs comments are included in the companys annual report. The propriety audit, conducted periodically, evaluates the administrative and procedural soundness of the companys decisions. Additionally, the companys accounting is streamlined through an ERP system with audit trail functionality, further strengthening transparency and accountability.

Additionally, we engage professional agencies and Chartered Accountants for periodic physical verification of assets. Our internal financial control system covers the following aspects:

Fixed Assets Process	Payroll Process	Entity Level Controls	Cash and Treasury Process	Inventory Management Process
Intangible Assets Process	Revenue and Receivables Process	Financial Statements Closing Process	Purchase and Payables Process	Departmental Pre-Audit and Internal Audit

e-Governance

GMDC has integrated e-Governance into its core business processes, including Sales, Despatch, Finance & Accounts, and Material Management. This digital transformation facilitates stakeholders through online order booking and digital payment and receipt processes. By interconnecting all project sites via a centralized system, we ensure high transparency, which maintains the trust and confidence of our various stakeholders.

In addition to these advancements, GMDC conducts annual performance appraisals and asset declarations for employees through specialized software applications. This approach streamlines these processes, enhancing accuracy and efficiency while fostering a culture of continuous improvement.

Moreover, the Company has adopted e-Sarkar, a flagship initiative of the Government of Gujarat, for internet-based inter- departmental and intra-departmental file processing. This initiative further promotes operational efficiency and seamless communication, aligning with GMDCs commitment to leveraging technology for superior governance and stakeholder engagement. Human Resource and Industrial Relations

In FY 2024-25, GMDC significantly scaled up its Human Resource initiatives to support its aggressive business expansion and transformation goals. The Company has more than doubled its training initiatives over the previous year and enhanced recruitment efforts by hiring new employees across all management levels. Recruitment was strategically focused on onboarding top-tier talent from institutions like IIMs, IITs, XLRI, NITs, ISM Dhanbad, and other reputed engineering and science colleges, ensuring an infusion of innovation and leadership capability into the organisation.

Key initiatives include Project SHIKHAR and the Young Leaders Program (YLP), aimed at building a future-ready leadership pipeline. GMDC plans to recruit more young leaders in 2025-26 through this program. Comprehensive induction programs have been developed for both general hires and GPSC recruits to support seamless integration into the organisation.

To promote employee learning and development, GMDC achieved a record 24,243 training hours, a 64% increase over the previous year. Training was delivered across behaviuoral, technical, statutory, and legal domains, reinforcing a culture of continuous capability building.

The Company launched several employee welfare initiatives, including modernized canteens, improved guest houses and air- conditioned staff buses at project locations. These moves reflect GMDCs commitment to employee well-being, safety, and satisfaction.

A robust Annual Manpower Recruitment Plan was rolled out to support the Companys growing project pipeline, which includes new lignite and coal mines, beneficiation plants, and renewable energy ventures.

GMDC also prioritized employee engagement, conducting health camps, safety drives, recreational events, and motivational sessions involving employees and their families. The celebration of Vikas Saptah, in line with Government of India directives, highlighted GMDCs focus on inclusive development and good governance.

Overall, the Companys human resource strategy in 2024-25 focused on attracting top talent, fostering leadership, scaling training, and ensuring welfare, positioning GMDC as an employer of choice and a benchmark in the mining sector.

Cautionary Statement

Statements within the Management Discussion and Analysis section, which articulate the Companys objectives, projections, and estimates, utilise terms such as will, aim, believe, expect, intend, estimate, plan, objective, contemplate, project and similar expressions. These terms are intended to be forward-looking and progressive within the context of applicable laws and regulations. It is important to note that actual results may differ significantly from those expressed or implied by these forward- looking statements due to various risks and uncertainties, which may include economic conditions, government policies, and other incidental factors. Consequently, readers are advised to exercise caution and avoid placing undue reliance on these forward-looking statements.