Coal India Limited (CIL) is debating on hiking coal price for the regulated sector and may take a call soon, a senior official said. Costs are on the rise for the miner but realisation remained muted without revision of coal price for the regulated sector. CIL Chairman Pramod Agarwal during an earnings call said that the company is in serious discussion about raising coal price and a decision may be taken soon.
The world’s largest miner could see a wage hike by 5-7 per cent that will entail a jump in wage cost by 2-3 per cent, after taking into consideration the reduction in manpower by 13,000-14,000 employees through retirement, he said.
However, these are estimates as of now, the official said.
He indicated that the decision to increase coal price was delayed due to the onset of the Covid-19 pandemic. Coal prices in the global market have been on the rise for the last few months.
CIL’s revenue remains muted due to lower e-auction coal sales and realisation, while its supply to the regulated sector mainly the power sector is also much less.
The company sells coal to the regulated sector at Rs 1,391 per tonne while the e-auction price is Rs 1,752 a tonne.
Coal production and dispatch targets for the current year remain very optimistic. The company has set a production target of 670 million tonne and a dispatch target of 740 million tonne. In 2020-21, its production was 596 million tonne and offtake were 574 million tonnes.
