Coal India Ltd has witness steep decline in e-auction price realisation, as better domestic availability and receding global coal prices had reduced the aggressive buying seen earlier.
Data provided by CIL indicates that price realization had fell to its lowest level over the past 7 quarters, marked at INR 2019.59/MT during Q2 FY20 (Jul-Sep’19). E-auction realization was down 6% on the quarter from INR 2155.26/MT in Q1 FY20, which was also noted 22% lower on the year from INR 2592/MT in Q2 FY19.
Even the case of lower sales volume had failed to incite higher premiums in the auction, as the allotted volume decreased 19% on quarter and 12% over the same period last year to 15.49 MnT in Q2 FY20.
On the other hand, higher realizations was recorded from coal sold through the fuel supply agreement (FSA) route in the second quarter, on the back of CIL’s sharpening focus on non-power customers. FSA realisations at INR 1438.61/MT in Q2 FY20 increased by nearly 10% over the same period last year and 5% compared to the previous quarter.
Consequently, better sales via FSA route had improved CIL’s net price realization for the total raw coal sold over the quarter, as it grew to INR 1513.96/MT in Q2 FY20 in comparison with INR 1470/MT in Q1 FY20.
A subdued coal off-take recorded from CIL had limited company’s earnings from sales of raw coal in the second-quarter period. Apparently, total revenue generated from sales of raw coal was down 18% on the quarter to INR 18064.67 Crores in Q2 FY20.
CIL’s Sales of Washed Coal:
Sales volume of washed coal had fallen 25% on the quarter to 2.28 MnT in Q2 FY20, which was accompanied by a depressed price realization seen for the lot.
Price realization for sale of washed coal was assessed at INR 2957.85/MT in Q2 FY20, down 7% Q-o-Q from INR 3171.15/MT in Q1 FY20.
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