The Hindu Business Line : Coal India reduces floor price at e-auction

Kolkata, June 12 In an effort to maintain easy availability, Coal India has reduced the floor price for coal sold through e-auction. Beginning this month, the coal major has reduced the floor price at e-auction from 30 per cent over and above the notified price to 5 per cent.

Talking to newspersons here following a CIL review meeting on Wednesday, the Union Minister of State for Coal, Mr Santosh Bagrodia, said that reduction in floor price coupled with higher offering of coal was expected to bring down the inflationary pressures on the economy.

CIL will offer 15 million tonnes of coal on auction in June. This is irrespective of an actual sales of only 5.3 million tonnes against an offering of 11.5 million tonnes in May. The increased offering coupled with reduction in floor price, however, may leave a notional impact on CIL’s bottomline. Having recorded an average price of 82 per cent above notified price in April and 69 per cent in May, the company has sold seven lakh tonne of coal so far in June at “closer to the floor price”.

It may be mentioned that e-auction was instrumental in turning around CIL subsidiaries like Bharat Coking Coal Ltd and Eastern Coalfields in 2006-07. Both the perennially such companies registered handsome profits during the year riding on higher returns generated through e-auction sales.

Interestingly, BCCL posted a marginal profit and ECL slipped into the red in 2007-08, when e-auction remained suspended for the larger part of the year.

Meanwhile, Mr Bagrodia maintained that there was no shortage of coal in the country and urged the power utilities to maintain 21 days stock position.

Related Stories:
Coal comfort
Coal India to market 40 mt thru e-auction during May-July

More Stories on : Coal | E-Commerce & E-Business

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page