Coal ball by ball cricbuzz Ltd (CIL) incurred its highest ever funds expenditure of Rs 13,115 crore in the previous financial year, a 109% rise compared to the last year’s capex of Rs 6,270 crore.
The rise in capex comes at a time when the Centre has instructed CPSEs of the country to scale up their expenditure to boost the economy in the midst of Covid slump, a company executive said.
CIL’s original sanctioned capex budget was Rs 10,000 crore for FY21. The government had afterwards revised the target to 130% for the firm to be evaluated as ‘excellent’ under this specific parameter in MoU rating.
“The entire capital expenditure was funded through internal resources. Capex growth during all the four quarters of FY21 was significantly higher compared to previous year. Progressive upto December 2020 also, our capex utilisation was more than what was mandated by the Ministry of Coal,” stated by a senior official of the company.
Procurement of heavy earth moving machinery at Rs 3,453 crore topped the list of capex heads for FY21, followed by land at Rs 2,470 crore. Capex in joint ventures, in proportion to CIL’s shareholding, like Talcher Fertilizers Ltd and Hindustan Urvarak & Rasayan Ltd accounted for Rs 2,194 crore.
CIL’s coal evacuation initiatives which include establishing coal handling plants, silos and constructing sidings accounted for Rs 1,398 crore. Construction of rail corridors and railway lines added Rs 1,166 crore, while the rest was made up by different other heads.
South Eastern Coalfields (SECL), though did not surpass its revised budgeted target, was the highest capex spender among all CIL’s subsidiaries at Rs. 3,260 crore.
“The high capex will yield positive results to the company in ensuing years in terms of production and coal transportation,” the executive added.