CIL surpasses capex target for FY21, logs highest-ever capex of Rs 13,115 cr

• This also marks CIL's all-time high capital expenditure, breaching the ramped up capex target of Rs 13,000 crore, achieving 101 percent of the revised target

• The govt assigned CIL a challenging 130 percent achievement of the budgeted target for it to be evaluated as 'Excellent' under this specific parameter in MoU rating

New Delhi: In a year marred by the COVID-19 pandemic, Coal India Limited (CIL) has surpassed its revised capex (capital expenditure) for FY21 and has spent more than double the money it spent in FY20, the company said in an official statement on Thursday. "CIL more than doubled its capital expenditure (capex) to an unprecedented high of Rs 13,115 crore in FY21 in comparison to the previous year. Against the capex of Rs 6,270 crore in FY20, the company clocked 109 percent growth amid the Covid slump. Never before was such capex growth registered by CIL," said the statement. 

This also marks the state-owned Maharatna coal miner's all-time high capital expenditure, breaching the ramped up capex target of Rs 13,000 crore, achieving 101 percent of the revised target. The feat comes at a time when the Centre has advised CPSEs to scale up their capex to boost the economy.

CIL had budgeted capex of Rs 10,000 cr for FY21, ramped it up later

CIL's original sanctioned capex budget was Rs 10,000 crore for FY21. However, the government assigned CIL a challenging 130 percent achievement of the budgeted target for it to be evaluated as 'Excellent' under this specific parameter in MoU rating, said Coal India.  This prompted CIL, for the first ever time, to tweak up its capex budget by 30 percent and revise it to Rs 13,000 crore. 

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"The entire capital expenditure was funded through internal resources. Capex growth during all the four quarters of FY21 was significantly higher compared to the previous year. Progressive up to December 2020 also, our capex utilisation was more than what was mandated by the Ministry of Coal," said a senior official of the company.

Capex: What did CIL spend on?

The 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, yet another important capital of CIL. 

Capex in joint ventures, in proportion to CIL's shareholding, like Talcher Fertilizers Limited (TFL) and Hindustan Urvarak & Rasayan Limited (HURL), accounted for Rs 2,194 crore. CIL's coal evacuation initiatives which include setting up coal handling plants, silos and constructing sidings accounted for Rs 1,398 crore. The construction of rail corridors and railway lines summed up Rs 1,166 crore, while the rest was made up by other heads. 

CIL and five of its subsidiaries — CCL, NCL, WCL, MCL and CMPDIL — coasted through their respective revised capex targets for 2020-21. SECL, though did not surpass its revised budgeted target, was the highest capex spender among all CIL's subsidiaries at Rs 3,260 crore, creating a record for itself. 

"The high capex will yield positive results to the company in ensuing years in terms of production and coal transportation," said the executive.

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