Coal India's e-auction allocation jumps 65 pc in Apr-Sept

Coal India Ltd (CIL) booked 41.4 million tonnes (MT) raw coal in e-auctions during April-September 2020, compared with 25.1 MT booked in the corresponding period last fiscal," the company said in a statement.

The increase in volume terms stood at 16.3 MT, it added. With the industrial and commercial activities reviving after the unlock, CIL is hopeful that the demand sustains and the sales get boosted soon.

With no dearth of coal, the company is confident of meeting the increased demand, it said. Last year's coal import trend showed that 40 per cent of the imports of dry-fuel were by traders.

CIL decided to give more thrust in auction sales that resulted in higher volumes. This is also in line with the government's push on 'Atmanirbhar Bharat' in the energy sector, it said.

"Even with the pandemic slowdown, CIL could net 10 per cent average premium over notified value in the first six months of the current fiscal as compared to 48 per cent of the same period year, but the aim was to increase volume supplies," the company said. It added that the company anticipated the liquidity crunch that COVID-19 would bring to its customers and brought down the reserve price close to zero to help them lift more coal during the lockdown phase.

In two tranches of three months each, CIL kept down its reserve price beginning April till September. After the company's board has given its nod, CIL for its October auctions has injected a rise in reserve price ranging from zero up to a maximum of 10 per cent over the notified price, as a dipstick survey to gauge the market response.

Based on the market reaction and the premium fetched from sale prices, the company will decide on reserve price for November. In volume terms, the booked quantity under spot e-auction was the highest at 16 MT during the first half of 2020-21 clocking a growth of 43 per cent, compared with 11.2 MT booked in the April-September period of last fiscal.

Spot e-auction is meant for both regulated and non-regulated customer base. It was followed by 13.4 MT booked in exclusive auction for non-power consumers.

Special forward auction for power producers bagged 10 MT, while special spot auction yielded 2 MT during the period. With the power sector having 34.2 MT coal stock sufficient for 19 days and no plant in critical condition for want of coal at September-end, CIL could focus on the non-power segment where the response from exclusive non-power e-auction was rousing in growth terms with almost a five-fold jump.

"Exclusive auction for non-power consumers during the referred period at 13.4 MT was up by 11.1 MT, against 2.3 MT that this sector booked last year in the corresponding period. In the growth terms, the rise is a whopping 482 per cent," it said. The power sector showing signs of recovery registering double-digit growth in the first week of October bodes well for us to ramp up our sales, the firm said.

The power sector is CIL's major coal-consuming customer accounting for around 80 per cent of its entire sales.