Coal India Ltd’s (CIL) profits remained flat during the second quarter of the current fiscal.
The company on Wednesday reported a profit of Rs 3,052.36 crore (Rs 3,078.08 crore in the previous year period). This is despite witnessing growth in production as well as sales.
The company’s Chairman, S. Narsing Rao, attributed it to a decrease in realisation of sales through e-auction and increase in cost of production.
In the second quarter, CIL sold more coal via e-auction at 12.88 million tonnes against 10.28 million tonnes in the corresponding quarter last year.
However, the realisation per tonne of coal decreased by Rs 19 a tonne to Rs 1,418 (Rs 1437) a tonne.
Rao said there is an overall decrease in e-auction price because of drop in demand. Coal India sells nearly 10 per cent of its output through e-auction.
Another reason for flat profits is an increase in production cost, Rao said. During July-September 2013-14, Coal India spent Rs 13,112 crore to mine coal against Rs 12,098 crore, which added to flat profits.
Production rises
CIL reported an increase in production as well as sale of coal in the second quarter. It mined 97.60 million tonnes of coal during July-September 2013 against 89.07 million tonnes in the same months previous year.
At the same time, offtake of coal increased to 109.12 million tonnes in the quarter against 101.74 million tonnes.
Rao said the company may import 5-6 million tonnes in the current fiscal.
However, it is confident to meet most of its demand from domestic mines.