Coal India’s capital expenditure has grown 37 per cent at ₹10,717 crore in April-December 2021, as compared with ₹7,801 crore same period in the previous year. The capex spend marks around 86 per cent of the progressive target achievement.

The country’s largest coal miner’s capex target is ₹17,000 crore for FY22, 28 per cent more than the actual capital expenditure of ₹13,284 crore during FY-21.

The capex scale-up comes at a time when the central government has been urging public sector entities to step up their annual capex. Capex is a key performance area which has a weightage value of 15 per cent in performance evaluation in the Memorandum of Understanding that CIL signs with Ministry of Coal at the beginning of every financial year.

The three major heads which accounted for nearly 54 per cent of the total capex at ₹5,786 crore include land acquisition, procurement of heavy earth moving machinery and joint ventures - primarily Hindustan Urvarak Rasayan Ltd and Talcher Fertilizers Ltd, said a press statement issued by CIL.

Construction of coal handling plants, silos with ₹ 1,344 crore and rail sidings and rail corridors at ₹1,785 crore made up for 29 per cent of CIL’s entire capex during the first nine months of the fiscal. The company is focusing on increasing its evacuation capacity by rail by an additional 330 million tonnes per annum by FY24.

Capital expenditure on land acquisition at ₹2,490 crore, crucial for developing new mines and expansion was 121 per cent of the progressive target by the end of December 2021. The target for the period was fixed at ₹2,057 crore.

Procurement of earth moving machinery at ₹2,031 crore exceeded the progressive target of ₹1,783 crore by 14 per cent during this period.

“Our endeavour is to keep abreast of our capex targets. However, capex will be contingent on the demand for coal, sales realisation, and production needs. The investments will be made accordingly,” a senior company official said in the statement.

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