Allocation in CIL’s coal sales via auction route has extended its growth during Jul ’20 driven by higher buying seen from the power sector.
The miner had recorded sale of 7.5 mn t coal in the auctions conducted across its various subsidiaries during Jul ’20, which increased 29% m-o-m from 5.83 mn t in Jun ’20. Besides, allocated volume had also noted an exponential growth y-o-y from 1.28 mn t in Jul ’19.
However, no such improvement was seen in terms of price realization for the booked quantity as fresh lock-downs imposed at various regions of the country stalled the progress in industrial activities. Thus, in the absence of stiff competition, coal was procured at inferior bids.
Price realization for coal sales via auction had decreased 23% m-o-m to INR 1342.92/t in Jul ’20 as against 1750.80/t in Jun ’20.
Moreover, there was a subtle fall in revenue earned from these auctions. The company fetched net revenue of INR 1007 Crores from the auction, thus fetching an increase of 8% over the notified coal value. In contrast, previous month’s auction had generated revenue of INR 1012 Crores and a premium of 11%.
Scheme-wise coal allocation:
| Name of Scheme | Spot | Special Forward | Exclusive | Special Spot | Total |
| Quantity offered | 8.58 | 11.70 | 4.67 | 2.53 | 27.48 |
| Quantity allocated | 3.65 | 3.20 | 0.32 | 0.33 | 7.50 |
| Total Notified Value | 503.81 | 308.05 | 69.47 | 51.15 | 932.48 |
| Total Booking Value | 567.79 | 312.73 | 74.98 | 51.42 | 1006.92 |
| % Increase over Notified Value | 13% | 2% | 8% | 1% | 8% |
Quantity in mn t | Value in INR Crores
CIL had increased offered quantity in the current month’s auction by 17% m-o-m to 27.48 mn t, wherein bulk volume was earmarked for special forward auctions. Incidentally, with a gradual decline in coal stock, power plants had shown greater eagerness to re-stock coal post-monsoon after which demand for electricity from industrial sector is expected to recover.
Allocation in special forward auction rose by almost 5-folds to 3.2 mn t in Jul ’20 compared with 0.64 mn t in Jun ’20, whereas sales volume from other auction schemes had fallen from the previous term.
Nevertheless, a better response was received for spot auction, wherein 43% of the offered material was sold at a premium of 13%.
Resumption of manual loading benefited BCCL in acquiring higher bid offers in its recent spot auction, thereby helping it to outperform the remaining subsidiaries in terms of premium received against the notified coal value. In addition, consistent performance was observed from ECL and CCL as well. (Complete subsidiary-wise result of various auction schemes can be seen here.)
With CIL set to commence special spot auctions for coal importers from this month, it would provide an opportunity for the miner to liquidate bulk of its stock-piles, which has been a major hurdle in elevating the coal production from present level.
Leave a Reply