Financial Daily from THE HINDU group of publications
Wednesday, Jan 04, 2006
BCCL achieves breakeven, set to post Rs 70-cr net this year
Kolkata , Jan 3
FOR the first time since incorporation in 1972, Bharat Coking Coal Ltd (BCCL) has achieved breakeven; during the April-December 2005 period, it earned profit of about Rs 1.66 crore against a loss of about Rs 259 crore in the corresponding period in 2004-05. The company is all set to earn profit of Rs 70-80 crore in the current fiscal on its own, despite implementation of the National Coal Wage Agreement-VII.
BCCL was set up to operate coking coal mines in the Jharia and Raniganj coal belts and to ensure planned development of the country's scarce coking coal resources.
The company incurred losses on a continuous basis till 2003-04, when capacity utilisation of the company's manpower and machine declined from 82 per cent to 62 per cent owing to under-investment on replacement of equipment to the extent of 40 per cent of the depreciation costs of such machines.
Positive measures: The Chairman of BCCL, Mr Partha Bhattacherjee, told newspersons that the physical and financial performance of the company took a positive turn with the initiation of a series of measures in 2003-04.
The fundamental reason for decline in production was shrinkage in mine capacity arising out of under-investment in mining equipment.
This was addressed by introducing a Rs 868-crore equipment replacement plan and internalising of the market premium on coal sold to non-core sector through Internet-based e-marketing.
Mr Bhattacherjee said that the turnaround in less than two years from a position of near bankruptcy has been possible through dedicated and sustained pursuit of the revival strategy.
He also said that the company expects to contribute an additional five million tonnes a year in the next five years.
Equipment replacement: Under the first phase of equipment replacement programme, orders for new equipment worth Rs 307 crore were already placed. Equipment worth Rs 130 crore has been delivered by the vendors and are in operation, thereby aiding higher production.
Mr Bhattacherjee said that the company is aiming to achieve a production target of 23.3 million tonnes (mt) in 2005-06,which will be one mt more than that for last fiscal.
Of the targeted production, about 2.5 mt would be sourced from contract mining awarded for a total of 14 isolated patches of mines.
He also said that a detailed action plan for modernisation of coking coal washeries has been taken up for implementation.
This is in addition to a global tender floated for introduction of powered support longwall face at Monidih underground mine, under a loan arrangement with SAIL.
Moreover, the development of `Kalyaneswari', a large opencast mining project, has initiated production of 2-mt medium coking coal plus three mt non-coking coal.
Similarly, action has been initiated for augmenting North & South Tisra to develop a five mtpa capacity opencast mine.
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