Coal India
More than the Q4 and FY16 performance of Coal India, the market and investors were happy with the much awaited hike in coal price has finally happened. The company announced that its Board approved increasing the weighted average price of coal by 6.2% over the current price. This new price comes into effect from today and will be applicable on all subsidiaries of the company, both regulated as well as non-regulated sectors.
This price hike is expected to earn the company an additional revenue of Rs.3234 crore for balance period of financial year 2016-17. The company has also approved the differential price for Non-Regulated Sector at a reduced rate of 20% v/s 35% earlier over the price of regulated sector for G6 to G17 grades of coal for all subsidiaries of CIL.
Coming to its performance for Q4 and FY16. Its numbers for Q4FY16 were flat – consolidated net profit came in at Rs.4248 crore v/s Rs.4238 crore (YoY), a rise of Rs.10 crore. For the quarter, consolidated EBITDA was down 7% at Rs.5534 crore while margins slipped down from 28% to 25.9%.
It ended FY16 with a 4% rise in consolidated net profit at Rs.14,274 crore and this was despite production going up 9% to 538.75 mt and offtake rose 9% to 534.49 mt. The company’s wage bill is monstrous – total employee outgo for FY16 was at Rs.29,660 crore, which ate away 38% of total income earned. Its CSR expenses also burgeoned 263% to Rs.1082 crore.
Prices of coal fell in open market auctions and fuel supply agreements (FSAs). FSA prices declined to Rs 1,311 a tonne during FY16 against Rs 1,327 a tonne in the previous year. The e-auction price fell to Rs 1,858 a tonne against Rs 2,450 a tonne in FY15. This, coupled with some decline in washed coal realisations, etc, resulted in the overall price realisation reducing during the year to Rs 1,418 a tonne from Rs 1,475 a tonne in the previous year.
The PSU’s equity stands at Rs.6316 crore and EPS for the year came at Rs.23 (FV of Rs.10/share). Debt is less than Rs.1000 crore and reserves was at Rs.34,037 crore. One of the most cash-rich PSUs, cash as at 31st March 2016 was at Rs.38,313 crore, down 19%.
Govt of India owns 79.65% stake.