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Coal ministry says that coal-block allotment to private players would only be done through a bidding process in the future
The country’s largest coal producer Coal India Ltd (CIL) has seen an estimated two-fold jump in profit to Rs10,616 crore in 2009-10, coal minister Sriprakash Jaiswal said today, reports PTI.
Profits of CIL for 2009-10 stood at Rs10,616 crore, which is almost double of last year's figure, Mr Jaiswal told reporters.
In 2008-09, CIL had registered a profit-before-tax of Rs4,238.58 crore, which the company said was low on account of the over Rs5,000 crore wage revision for its employees.
The minister further said that the company’s IPO is likely to be launched in August, which will see the Centre divesting 10% of its stake in the coal major. The government at present holds 100% stake in the company.
Mr Jaiswal said that almost 90% of the coal produced in the country was of “average quality” and it was trying to get coal properties outside the country to meet requirements.
Though the average quality coal can be used in thermal plants, the country required good quality for cement, paper and other industries for blending it with the one available with the country, he added.
Mr Jaiswal said that henceforth, coal-block allotment to private players would be only through bidding process.
“Only the highest bidder would be given coal blocks in the country, as it was found that private players were acquiring them as property assets,” the minister said adding that an amendment Bill for the same is awaiting a Parliamentary nod.
He, however, stressed that under the government dispensation, the Centre would decide on allotting coal blocks to states demanding them, but it would be only on merit.
“It would be seen which state is making the demand first and the status of its power plants besides considering other merits before allotting coal blocks,” the minister added.
The market is getting long in the tooth and the chance of a sudden reversal is strong
Market indices touched a two-year high today. They opened high, sold off in late morning trade and rebounded to record new highs. Even after selling went up in late afternoon trades, the BSE Sensex ended the day with a gain of 67 points (up 0.38%) at 17,711 points and the Nifty ended at 5,302 points, 21 points higher (up 0.3%).
European stocks traded higher on Monday. Asian stock markets were mostly higher on Monday as stronger earnings from Chinese companies and a deal to provide Greece a financial safety net helped buoy sentiment. The key benchmark indices in Hong Kong, Singapore, and Taiwan rose by 0.49% to 0.88%. However, the key benchmark indices in South Korea, Indonesia and Japan fell by 0.09% to 0.94%. Japan's retail sales gained at the fastest pace in more than a decade in February as economic recovery spread to households. Sales rose 4.2% from a year earlier, the Japanese trade ministry said in Tokyo. Sales posted the biggest monthly jump since 1997.
Russia's central bank cut key rates by 25 basis points on Friday, and analysts forecast more easing to come as the economy remains sluggish and the currency still strong. China's annual economic growth will reach 12% this quarter, a government researcher said. The Dow Jones Industrial Average rose 9.15 points and the S&P 500 Index inched up just 0.86 points on Friday. World trade in merchandise goods is expected to rebound strongly this year as economic recovery takes hold, expanding by 9.5%, said the World Trade Organization’s director-general.
Closer home, the finance ministry said that gross domestic product grew at the rate of 5.6% in the 4th quarter against 5.9% estimated earlier. The RBI said that it will hold the liquidity adjustment auction on Tuesday and Wednesday. It usually conducts one such auction, except for reporting Fridays when there are two repo and reverse repo auctions.
The government will sell Rs2.87 trillion ($64 billion) of bonds in the first half of 2010-11—63% of its record full-year target, less than market expectations, sending yields down. On an average, Rs110 billion-Rs150 billion of issuance would come to the market every week.
FIIs were the strong net buyers on Friday (Rs591 crore). Domestic buyers also purchased stocks worth Rs49 crore. Among stocks, Punj Lloyd (down 3.8%) will sell its stake of just over 19% in Pipavav Shipyard to co-founder SKIL Infrastructure to raise cash by selling assets. The report said that the deal was likely to be struck at Rs700 crore, at a discount to the prevailing market price as Punj Lloyd is selling before the end of a three-year lock-in period. Pipavav Shipyard listed last year, with an initial public offer. Founder-shares are locked in for a period of three years from the completion of an IPO, under Indian regulations. SKIL, which holds about 20% in Pipavav, will have to make an open offer to minority shareholders for a further 20% stake. Axis Bank (up 0.68%) has issued 5.5-year bonds worth $350 million, priced at 275 basis points over comparable US treasuries. The transaction was upsized to $350 million from an original $300 million to accommodate additional investor demand. Nagarjuna Construction Company (up 3.5%) is about to reach financial closure for its thermal power project at Srikakulam district in Andhra Pradesh. We expect the market to trend higher over the medium term thanks to a strong rupee, low interest rates and expectations of continued economic growth.
However, the market is getting long in the tooth and a chance of a sudden reversal is strong.
According to sources, the fruit-juice manufacturer has not been issuing salaries and has also stopped production
Another likely casualty of the financial turmoil in the Indage empire is Seabuckthorn Indage Ltd (SIL), which reportedly has not been paying salaries to its employees since February 2009. Last week, Indage Vintners was on the brink of being liquated (it has subsequently received a stay from the Bombay High Court). Indage Vintners has a considerable stake in SIL.
An employee of SIL has written to us saying, “I am working with Seabuckthorn Indage Limited, our company is not paying salaries and expenses of field staff from last February 2009 and expenses from April 2008 to date.”
SIL is a producer of the ‘Leh Berry’ range of juices. The brand produces eight different types of flavoured juices like sea-buckthorn, mixed-fruit, orange, mango, guava, blackcurrant, litchi and peach.
According to the employee, earlier in the year, SIL’s managing director Mahendra Singh Dhanota told the staff that the company would pay all its dues in the coming months. However, the employee alleges that on 27 March 2010, Mr Singh told the employees that the Indage Group is winding up operations, so it would not be possible for SIL to pay its dues.
Moneylife repeatedly contacted SIL but we were told that nobody in senior management was available to speak on the issue. Finally, an employee called Mr Dassan told us that the company has not been producing any juice in the past three to four months owing to financial problems.
In January 2007, Indage Vintners acquired 6.5 lakh shares or 52.63% stake in SIL. As on 31 March 2008, the company retained this stake in SIL. Latest figures on Indage’s stake in SIL were not available.
We contacted Ranjit Chougule, managing director, Indage Vintners, for information on SIL. He sent us a text message which says, “We are only shareholders of Seabuckthorn Indage. You would need to contact their management.”
At one stage SIL was planning to diversify into home and personal care products, confectionery, biscuits, specialty cosmetics and OTC pharmaceuticals. It introduced its bottled water under the ‘Mountain Spring’ brand in 2007.