Key highlights

• During the quarter, GMDC produced about 24.79 lakh tons of lignite as compared to about 27.98 lakh tons for Dec'11 quarter. The lower production is due to the issues of their customer. Bricks and ceramics industry as a whole did not took any offtake during the quarter due to some issues regarding MOEF clearances. However, Government has subsequently, intervened and the matter is solved. Industry started its production and so as the offtake of lignite.

• For 9 months about 80 lakh tons of lignite were produced and management is confident of reaching around 120 lakh tons by Mar'13. For FY'14, management expects atleast 142 lakh tons of production of lignite.

• GMDC awarded the outsourcing of power plant contract to the Korean company and from Feb'13 this has become effective. For first 6 months, about Rs 14 crore will be paid to Korean company as O&M charges and subsequently, the payment of O&M and supply and consumables will be on performance basis. As per the contract at PLF of 75%, fixed Rs 28 crore will be provided as O&M to Korean company and any fall or rise from that will lead to cut or increase in payments. Current PLF of plant is at 50%.

• With increase of diesel prices, the mining costs per ton have increased. As per the management, to take care of the diesel prices and other mine recovery charges a hike of more than Rs 100 per ton in lignite will be made effective from April'13 onwards. Still, the lignite costs will be cheaper by about 12-15% compared to the landed costs of coal.

• During the quarter, of the 24.79 lakh tons of lignite production, about 3.84 lakh ton was from Bhavnagar, 7.42 lakh tons from Panandhro, about 1.17 from Rapardi 7.27 from Mata-No-Madh, Tadkeshwar was about 4.98 and Bhavnagar produced about 3.84 lakh tons of lignite.

• Other income includes about Rs 11 crore of capital gain on sale of land.

• Nalco JV is moving slowly, as Nalco is yet to get the approval regarding the land and environment.

• Overall, company has plans to invest around Rs 300 crore for land acquisition, about Rs 300 crore in next 3 years in wind power.

• Umarsar mine is a surprise package for the company. The site got the approval of production from April'13 onwards. The mine has a production capacity of about 10 lakh tons of lignite in total. Also in Jamnagar, the company received permission to start Bauxite mining having capacity of about 1 lakh tons p.a.

• For the nine months ending Dec'13, company produced Bauxite of about 7.7 lakh tons as compared to about 6.7 lakh tons y.o.y. The production will continue to increase gradually on q.o.q basis.