Team News Riveting
State-run Coal India Limited (CIL) had registered an all time high capital expenditure at Rs 5,023 crore in the first half (H1) of the fiscal 2020-21 recording 118 per cent growth.
“This is a historic high in capex utilization as CIL has not exceeded 30 per cent target utilization in the first half of a fiscal so far,” a senior official of the company said. The previous three year average of H1 capex utilization has been around 20 per cent, the official added.
CIL during April-September clocked a robust capex growth of 242 per cent compared to the previous year’s corresponding period. The actual capital expenditure of Rs 5,023 crore in the H1 was up by Rs 3,556 crore against Rs 1,467 crore in April-September 19.
Actual capex ending second quarter (Q2) of the current fiscal at Rs 4,179 crore was up by Rs 3,165 crore compared to Rs 1,014 crore in the same quarter last year, logging a whopping 312 per cent growth. In the Q2 as well CIL achieved 118 per cent utilization breaching the provisioned target of Rs. 3,527 crore.
Recently the government has asked CPSEs, including CIL, to speed up their capital expenditure to boost growth especially by the end of second quarter of FY ’21. CIL’s capex spend during the H1 ended September’20 was a little over half of the entire FY 21 capex of Rs.10,000 crore.
The Minister of Coal, Pralhad Joshi has been closely monitoring the progress of processes like land acquisition, setting up of rail logistics and associated infrastructure and mine development of especially mega mine projects and speeding them up.
Payments were made for acquisition of land post COVID-19 unlocking. Major high value tenders could be concluded on time and heavy earth moving equipment (HEMM) was procured. CIL’s robust capex spending came on the back of these issues.
Among the major heads, purchase of heavy earth moving machinery (HEMM) at Rs 1,360 crore that accounted for 27 per cent of the total capex of the current H1. It followed payments for acquisition for mining operations which made up close to 26 per cent of the capex where CIL spent Rs 1,289 crore.
Setting up important rail lines and developing sidings constituted around 21 per cent of the H1 capex. CIL spent Rs 1,078 crore under this head. These three heads combined at Rs 3,726 crore made up for around 74 per cent of the first half’s entire capex. The components for the rest 26 per cent or Rs 1,297 crore include mine development, coal handling plants, silos, roads, exploration and prospecting, other plant and machinery and joint venture investments.
