Coal India's consolidated net profit dropped by 6.6 per cent to Rs 3,764.34 crore in the April-June quarter ended June 30, <g data-gr-id="39">2015</g> due to higher expenses. The state-run coal miner had reported a net profit of Rs 4,033.28 crore in the corresponding quarter of the previous fiscal.
Net sales during the quarter rose by 6.4 per cent to Rs 18,955.75 crore, from Rs 17,799.54 crore in the same quarter last year, Coal India said in a filing to the BSE. Total expenses increased to Rs 15,131.38 crore in April-Jun 2015, from Rs 14,036.91 crore in the year-ago period.
The company's production rose by 12 <g data-gr-id="36">per cent</g> to 121.35 million tonnes during the April-June quarter this year compared to 108.32 million tonnes (mt) in the <g data-gr-id="35">year ago</g> period. Coal India accounts for over 80 per cent of the domestic coal production. On <g data-gr-id="42">standalone</g> basis, Coal India's net profit dropped by 59.6 per cent to Rs 485.47 crore during the quarter under review, from over Rs 1,202.02 crore in the corresponding quarter of the previous fiscal.
Total income from operations of the company during the quarter dropped to Rs 37.74 crore, over Rs 67.25 crore in the year-ago period. Shares of the company closed at Rs 371.45 on BSE, down 5.53 per cent from <g data-gr-id="38">previous</g> close.
Meanwhile, the government will sell 10 per cent stake in Coal India through a public offer, which could fetch about Rs 23,400 crore to the exchequer. The department of disinvestment (DoD), the Ministry of Finance, is in the process of appointing merchant bankers for managing the stake sale.
“The Government of India intends to disinvest 10 per cent paid up equity capital of CIL out of its shareholding of 78.65 per cent, through offer for sale (OFS) of shares by promoters through the stock exchanges,” the DoD said while inviting bids from merchant bankers.
At the current market prices, <g data-gr-id="49">sale</g> of 63.16 crore shares or 10 per cent stake would fetch Rs 23,460 crore to the exchequer. The government will appoint up to five merchant bankers to manage the stake sale and the last date for application is September 2. Coal India Ltd (CIL) was listed on <g data-gr-id="47">stock</g> exchange on November 4, 2010, and its market value today stands at Rs 2,34,621 crore. Employees of CIL would be eligible to apply for shares worth up to Rs 2 lakh and would be offered a discount of up to 5 <g data-gr-id="40">per cent</g> on the issue price, the Finance Ministry said.
The merchant bankers would be required to advise the government on the timing and modalities of the OFS and also ensure <g data-gr-id="44">best</g> return to the exchequer. Shares of CIL closed at Rs 371.45, down 5.53 per cent over <g data-gr-id="43">previous</g> close on the BSE. The government had last sold 10 per cent stake in the blue chip coal major on January 31, 2015. It had then garnered Rs 22,557 crore to the exchequer. The disinvestment department is readying PSUs for stake sale and is seeking Cabinet approval for the same.