New Delhi: As the government has been pushing public sector undertakings (PSUs) to meet their capital expenditure (capex) targets, Coal India Ltd (CIL) is a step ahead of the rest and has increased its capex for the year. "Coal India Limited (CIL) has scaled up its capital expenditure budget by an additional Rs 3,000 crore, revising it to Rs 13,000 crore for the ongoing fiscal. This represents 30 percent jump over CIL's original capex target of Rs 10,000 crore for 2020-21," the state-run coal miner said in an official statement.
The government has directed Central PSUs of the country to step up their capital expenditure to stimulate economic activity.
Of the additional Rs 3,000 crore injected into CIL's capex budget, South Eastern Coalfields Limited (SECL), the largest coal producing subsidiary of CIL, accounts for Rs 800 crore, followed by CIL headquarters at Rs 585 crore and Mahanadi Coalfields Limited (MCL) with Rs 550 crore. Central Coalfields Limited is slated to take up Rs 460 crore.
In an endeavor to elevate production, the major heads CIL has identified for capex are land acquisition, procurement of heavy earth moving machinery, upgrade of rail evacuation infrastructure and mine development.
Maintaining its growth streak in capital expenditure since the beginning of the fiscal, CIL in a stellar show has posted a whopping 166 percent growth at Rs 7,801 crore during the first nine months of the fiscal ending December'20. Compared to Rs 2,930 crore capex that the company clocked during the same period last financial year, the actual spend was up by Rs 4,871 crore.
"In the process, CIL has utilised 78 percent of its total original capex budget during April-December'20. CIL was directed by the Ministry to achieve Rs 7,500 crore capex utilisation by the closure of December'20 against which the actual capex utilisation was Rs 7,801 crore, which is Rs 301 crore more," said a senior executive of the company.
CIL's capex for the current year's Q3 as well, ending December'20, at Rs 2,778 crore posted a strong 90 percent growth against Rs 1,463 crore of the same quarter last year. The increased spend during the third quarter was Rs 1,315 crore. For Q2 of the current year, CIL logged a robust 312 percent capex growth and a growth of 86.5 percent in Q1. CIL's capex during the current financial year makes it one of the top spenders among the Indian PSUs.
Coal India's land possession and civil construction jobs, among other activities, were hamstrung during the Covid-led slowdown. Subsequently, headway could be made with the situation improving post unlock, nudging its increased capital expenditure.
"CIL will be closely monitoring the progress of the capital expenditure to achieve the revised target of Rs 13,000 crore in the current FY," said the executive.
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