Coal India Corporate Presentation 18 November 2013
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Transcript of Coal India Corporate Presentation 18 November 2013
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Coal India LimitedCorporate Presentation
November 2013
Energy Security, Growth & Sustainable Development
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Disclaimer
This presentation is issued by Coal India Limited (the Company or Coal India or CIL) for general information purposes only, without regard to specific objectives, suitability,
financial situations and needs of any particular person and does not constitute any recommendation or form part of any offer or invitation or inducement to sell or issue, or anysolicitation of any offer to purchase or subscribe for, any securities of the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in
connection with, any contract or commitment therefor. This presentation does not solicit any action based on the material contained herein. Nothing in this presentation is intended by
the Company to be construed as legal, accounting or tax advice.
The presentation contains various financial data and business related data concerning the Company (including coal reserves, resources and production capacity), you may note that,
unless otherwise specified, all such data is on consolidated basis, i.e., the Company and all its subsidiaries taken together. Further, it may be noted that such data / figures may have
been rounded off to the nearest integer.
This presentation may not be copied or disseminated, in whole or in part, and in any manner or for any purpose. No person is authorized to give any information or to make any
representation not contained in or inconsistent with this presentation and if given or made, such information or representation must not be relied upon as having been authorized by
any person. Failure to comply with this restriction may constitute a violation of applicable laws. Neither this document nor any part or copy of it may be distributed, directly or indirectly,
in the United States or to any U.S. persons within the definition set out in Regulation S under the Securities Act of 1933, as amended (the Securities Act). The distribution of this
document in certain jurisdictions may be restricted by law and persons in to whose possession this presentation comes should inform themselves about and observe any such
restrictions. By reviewing this presentation, you agree to be bound by the foregoing limitations.
You further represent and agree that (i) (A) you are located outside the United States, you are not a U.S. person within the definition set out in Regulation S under the Securities Act
and you are permitted under the laws of your jurisdiction to receive this presentation or (B) you are located in the United S tates and are a qualified institutional buyer (as defined in
Rule 144A under the Securities Act) and a "qualified purchaser" (as defined in Section 2(a)(51) of the Investment Company Act of 1940, as amended) and (ii) you are not, and you are
not acting on behalf of, a Benefit Plan Investor" as defined in the Employee Retirement Income Security Act of 1974, as amen ded (ERISA), (a Relevant Person). This presentation
is only directed at Relevant Persons and any person who is not a Relevant Person should not act or rely on this presentation or any of its contents.
This presentation is not an offer to sell or a solicitation of any offer to buy the securities of the Company in the United States or in any other jurisdiction where such offer or sale would
be unlawful. Securities may not be offered, sold, resold, pledged, delivered, distributed or transferred, directly or indirectly, in to or within the United States absent registration under
the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable
securities laws of any state or other jurisdiction of the United States. The Companys securities have not been and will not be registered under the Securities Act.
This presentation has been prepared by the Company based upon information available in the public domain. This presentation has not been approved and will not or may not be
reviewed or approved by any statutory or regulatory authority in India or by any stock exchange in India. This presentation includes statements which may constitute forward-looking
statements relating to the business, financial performance, strategy and results of the Company and/or the industry in which it operates. Forward-looking statements are statements
concerning future circumstances and results, and any other statements that are not historical facts, sometimes identified by the words "believes", "expects", "predicts", "intends",
"projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. The forward-looking statements, including those cited from third party sources such
as the Government of India's 12th 5 Year Plan (2012 2017), contained in this presentation are based on numerous assumptions and are uncertain and subject to risks. The actualresults could differ materially from those projected in any such forward-looking statements because of various factors, including, but not limited to, changes in demand, competition and
technology. Neither the Company nor its affiliates or advisors or representatives nor any of its or their parent or subsidiary undertakings or any such person's officers or employees
guarantees that the assumptions underlying such forward-looking statements are free from errors nor do any of such persons accept any responsibility for the future accuracy of the
forward-looking statements contained in this Presentation or the actual occurrence of the forecasted or targeted developments nor do they assume any responsibility to publicly
amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events, or otherwise. Forward-looking statements speak only as
of the date of this presentation.
The information contained in these materials has not been independent ly verified. None of the Company, its directors, promoter or affiliates, nor any of its or their respective
employees, advisers or representatives or any other person accepts any responsibility or liability whatsoever, whether arising in tort, contract or otherwise, for any errors, omissions or
inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred howsoever arising, directly or indirectly, from any use of this document or its contents
or otherwise in connection with this document, and makes no representation or warranty, express or implied, for the contents of this document including its accuracy, fairness,
completeness or verification or for any other s tatement made or purported to be made by any of them, or on behalf of them, and nothing in this document or at this presentation shall
be relied upon as a promise or representation in this respect, whether as to the past or the future. Past performance is not a guide for future performance. The information contained in
this presentation is current, and if not stated otherwise, made as of the date of this presentation. The Company undertake no obligation to update or revise any information in this
presentation as a result of new information, future events or otherwise. Any person/ party intending to provide finance/ invest in the shares/ businesses of the Company shall do so
after seeking their own professional advice and after carrying out their own due diligence procedure to ensure that they are making an informed decision.
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Presentation Outline
I. Coal India: Company Overview
II. Overview of the Coal Sector
III. Key Company Highlights
IV. Financial Summary
V. Appendix
A. Corporate Structure
B. Key Risks
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I. Coal India: Company Overview
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Genesis
Vision
1Largest listed coal company by annual production in FY2013
Our Genesis, Vision & Mission
Mission
To emerge as a global player in the primary energy sector committed to provide energy security to the country byattaining environmentally & socially sustainable growth through best practices from mine to market
To produce and market the planned quantity of coal and coal products efficiently and economically in an eco-friendly
manner with due regard to safety, conservation and quality
1973
Nationalization of coal mines to provide
for higher growth in coal sector
Incorporation as a private limited
company as Coal Mines Authority
Limited
Coal production at ~70 million tons
1975
To integrate and streamline the
structural set up, re-organised
Coal Mines Authority Limited as
Coal India Limited
Coal production at ~79 million tons
Today
A Maharatna Company
Largest pure play coal
producer in the world1
Coal production at ~452
million tons in FY2013
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Corporate History
Largest Pure Play Coal Producer In The World1
Coal MinesAuthority
Limited
reorganized
as Coal India
Overallproduction of
coal crossed
100 million
tonnes by
Coal India
and itssubsidiaries
CIL becomesindependent
as budgetary
support
withdrawn
completely
ConferredMini Ratna
Status
Awarded
AAA/Stable
Rating byCrisil
AwardedNavratna
Status
Overall
production of
coal crossed400 million
tonnes by
Coal India
and its
subsidiaries
Listing atBombay
Stock
Exchange
and National
Stock
Exchange
AwardedMaharatna
Status
Shift toGCV2based
pricing for
non-coking
coal
1Largest listed coal company by annual production in FY2013
2Gross Calorific Value
1975 1981 19982006 /
2007
2008 /
20092010 2011 2012
Deregulationof coal prices
in India
completed
2000
A Maharatna Company with a History spanning Four Decades
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62.7
80.918.2
Resources Reserves Total
Coal IndiaResources and Reserves1
Key to Indias Energy Security
Data as of April 1, 2011 based on the United Nations Framework Classification (UNFC) classification as measured and prepared by CMPDI Ltd, a wholly owned subsidiary of Coal India Limited
Provisional Statistics for 2013 from Coal Controller Organisation, Ministry of Coal, Government of India
BP Statistical Review, 2013
Coal India: Key to Indias Energy Security
Presence in Mozambique through Coal Videsh
2D / 3D seismic survey methods are being adopted for
exploration purpose, enabling faster identification of
resources
Development of Coal Bed Methane (CBM) / Coal Mine
Methane (CMM) prospects in collaboration with the
Government Agencies
Coal India81%
SingareniCollieries
10%
Others9% Coal India contributed 81% to Indias total coal production
in FY2013
Coal accounts for ~52.9%3of Indias primary energy
consumption
Coal India operates 462 mines in 21 major coalfields via 7
operating subsidiaries
billion tons
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Recognition by Platts in 2012 (1) Other Awards
Coal India: Leading Global Coal Company
(1) Platts Top 250 recognizes outstanding energy companies based on financial performance globally, regionally and by industry sector. Financial performance is measured using four key metrics: asset worth,
revenues, profits, and return on invested capital.
Platts Ranking - http://top250.platts.com/Top250Rankings(2) Out of the 250 Companies, Coal India ranks second amongst the Coal & Consumable Industry in terms of its financial performance.
Platts Ranking - http://top250.platts.com/Top250Rankings/2012/Region/CoalandConsumableFuels
Coal India Ranks 48thamongst the
Top 250 Energy Companies across
the World, based on its Financial
Performance.
Rank Company Country
1 China Shenhua Energy Co. Ltd.
2
Coal India Ltd.
3 China Coal Energy Co. Ltd.
4 Yanzhou Coal Mining Co. Ltd.
5 Peabody Energy Corp.
Global CSR Excellence and Leadership
Award 2013
Best Geospatial Application in an
Enterprise Award 2013
India Pride Award 2011 in Energy &
Power Category
MoU Excellence Award for Outstanding
Rating 2009-10
#2 in Coal and Consumable Fuels
Globally in 2012 (2)
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Total coal resources of 62.7 bt2and total coal reserves of 18.2 bt2
Largest pure play coal producer in the world1
Raw coal production (FY2013): ~452 million tons
Accounted for 81% of total coal production in India in FY2013
Operates 462 mines across 8 states in India as on 31 stMarch 2013
Coal and lignite account for ~68.5%4of the total commercial energy production in India (FY2012)
69.8 GW of additional coal and lignite based power generation capacity targeted during the XIIth5 Year Plan
Coal including lignite targeted to be used as fuel for 58.9% of the incremental power capacity during the XIIth5 Year Plan
Increase reserve base in India, acquire strategic international resources and identify joint development opportunities
Increase in production and productivity through deployment of state-of-the-art technology
Focus on sustainable development initiatives through resettlement & rehabilitation, reforestation, water harvesting, education,
health and safety initiatives
Introduction of third party sampling of coal at loading points from 1 stOctober 2013 for enhancing consumers satisfaction
Advanced equipment and technology for higher mechanization
Total revenues of INR 770,494m and EBITDA5of INR 277,574m for FY2013 (EBITDA margin: 36%)
FY11-13 EPS CAGR of 26.8%, Return on average equity of 39%5and Dividend payout ratio of 51% for FY2013
Net cash position5of INR 619,254m as of 31stMarch 2013
Experienced and qualified management team
Maharatna status allows for greater autonomy
Key Highlights
Largest PurePlay Coal
Producer inthe World
KeyBeneficiary of
Power SectorGrowth
Strategy forGrowth
Commitmentto Sustainable
Development
Healthy
Returns
ExperiencedManagement
Largest listed coal company by annual production in FY20132Data as of April 1, 2011 based on the United Nations Framework Classification (UNFC) classification as measured and prepared by CMPDI Ltd, a wholly owned subsidiary of Coal India Limited
Provisional Statistics for 2013 from Coal Controller Organisation, Ministry of Coal, Government of India4XIIth 5 Year Plan Document published by the Planning Commission and released in 2012-13, with FY2012 provisional data. There can be no assurance that this target wi ll be reached5Net cash position is calculated as cash balance and current investments reduced for outstanding debt; ROAE calculated as the ratio of FY2013 Profit after tax to the average shareholders equity for FY2013
and FY2012. EBITDA (unaudited) has been calculated by adjusting (adding back) the finance cost, depreciation / amortization/ impairment, provisions, write-offs, prior period adjustments and extra-ordinary
items. EBITDA includes other income and is net of overburden removal expense
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II. Overview of the Coal Sector
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4,961
6,9017,252
7,692 7,865
CY2002 CY2009 CY2010 CY2011 CY2012
CoalSecond Most Used Fuel Globally(1)
India Amongst the Leading Coal Producing Countries(2)
Steady Growth in Global Coal Production(1)
Source: (1)BP Statistical Review 2013; Coal Controller of India for India data(2)Production data for India is as per FY2003 and FY2013 as published by the Coal Controller of India (and does not include lignite), for other countries the data is for CY2002 and CY2012 as published
in BP Statistical Review 2013
Global Coal Sector
Oil33.1%
Natural Gas23.9%
Coal29.9%
NuclearEnergy4.5%
Hydro electric6.7%
Renewables1.9%
India is the 3rdLargest Coal Producer Globally
million tons
million tons
World Primary Energy Consumption (CY2012)
1,550993
341 341 103 220
3,650
922558 431 386 260
China US India Australia Indonesia South Africa
2002 2012
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532 533 540 558
795
73 69 103138
186
605 602643
696
981
FY2010 FY2011 FY2012 FY2013 FY2017Target
Production Import
CoalIndias Primary Source of Energy(1)
Coal Resources in India as on 01-Apr-2013(3)
Category Proved Indicated Inferred Total
Coking (million ton) 18,366 13,595 2,101 34,061
Non Coking
including tertiarycoal (million ton)
104,816 129,037 30,999 264,852
Total (million ton) 123,182 142,632 33,100 298,914
Demand Supply Scenario(2)
Source : (1) BP Statistical Review 2013, (2) Coal Controller of India, (3)Inventory of geological resources of Indian coal prepared by Geological Survey of India on the basis of resources estimated by CMPDI,
MECL, SCCL, GSI and DGM (Maharashtra) and DGM (Chattisgarh) as on 01-Apr-2013, Data as per ISP methodology which can be different from that under UNFC classification(4)
As per XIIth
5 Year Planreleased in 2012-13, with FY2012 provisional data. There can be no assurance that this target will be reached.
India Coal Sector Overview
Oil30.5%
Natural Gas8.7%
Coal52.9%
NuclearEnergy1.3%
Hydro electric4.6%
Renewables1.9%
million tons
(4)
Coal meets 30% of the worlds energy needs and accounts for 52.9% of Indias primary energy needs
India Primary Energy Consumption (CY2012)
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III. Key Company Highlights
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Largest listed coal company by annual production in FY20132Data as of April 1, 2011 based on the United Nations Framework Classification (UNFC) classification as measured and prepared by CMPDI Ltd, a wholly owned subsidiary of Coal India Limited3EBITDA (unaudited) calculated by adjusting (adding back) finance cost, depreciation / amortization, impairment, provisions, write-offs, prior period adjustments and extra-ordinary items. EBITDA includes other
income and is net of overburden removal expense; ROAE calculated as ratio of FY2013 Profit after tax to average shareholders equity for FY2013 & FY2012
Key Company Highlights
1
4
Worlds Largest Pure Play Coal Producer
1
FY2013 production of 452 million tonsacross 462 operational mines, with
ongoing projects for further ramp-up
62.7 bt Resources and 18.2 bt Reserves2
2
35
6
Growth Drivers
Favorable expected demand
from key sectors such as powerand steel
Cost Leadership with Stable Realizations
Higher proportion of open cast mining operations
and increasing labor productivity
Positive Margins & Returns
FY2013 EBITDA margin of 36%3
FY2013 ROAE of 39%3
FY2013 Dividend Payout Ratio of
51%
Qualified & ExperiencedLeadership
One of the premier state
run enterprises with a
highly experienced
management team
Organizational Commitment toSustainable Development
High focus on social,
environmental and health & safety
initiatives
Documented CSR policyWorlds Largest
Pure Play
Coal Producer1
7
Growth Drivers
Extensive
Mining
Capabilities
Cost Leadership
with StableRealizations
Positive Margins
& Returns
Qualified
& Experienced
Leadership
Organizational
Commitment to
Sustainable
Development
Extensive Mining Capabilities
State of the art technology in opencast mining
Focus on meeting commitments tothe power sector
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Largest Pure Play Coal Producer Globally1, Slated for Further Growth
377 395 390 393 408
173 179
795
27 36 41 4344
19 21
404 431 431436 452
192 200
FY2009 FY2010 FY2011 FY2012 FY2013 H1FY2013
H1FY2014
FY2017TargetNon-Coking Coking
Ongoing Projects Other Initiatives
148 ongoing projects under various stages of
implementation, out of which
90 projects have obtained both forestry and
environment clearances (as of 31-Mar-2013)
134 projects expected to contribute 335
million tons in FY2017
SECLs4Kusmunda mine expansion to 50
million ton annual production capacity is
under progress5
Note: FY ended 31-March
Source: BP Statistical Review 2013, XIIth5 Year Plan published by the Planning Commission of India1Largest listed coal company by annual production in FY20132Global production data for year ended 31-Dec; Coal India production data for year ended 31-March; For comparison purposes with global production for Dec-2012, Coal India data for FY2013 has been used3Figure refers to target for total domestic coal production in India in FY2017 as per XIIth5 Year Plan released in 2012-13 with FY2012 provisional data. There can be no assurance that this target will be reached.4South Eastern Coalfields Limited5Based on Company data and not independently verifiable
Worlds Largest Pure Play Coal Producer1
million tons 5.7% of globalCY2012
production
Investment in logistics and
infrastructure for coal off take
3 major railway infrastructure
projects to improve offtakefrom 3 growing coalfields in 3
subsidiaries
Investment in larger sizeheavy earth moving
machineries
Future Projects
126 new projects, with a targeted
capacity of 438 million tons, havebeen identified for the XIIth5 Year
Plan Period, out of which 78 projects have project reports
formulated
60 projects expected tocontribute 88 million tons in
FY2017
Indias target for totaldomestic coal
production as perXIIth5 Year Plan
3
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200
318
119
FY2012 Targeted Capacity AdditionDuring XIIth 5 Year Plan
FY2017Target
Sector Wise Demand of Coal(FY2013)
Source : XIIth5 Year Plan Document published by the Planning Commission of India, released in 2012-13 with FY2012 provisional data. There can be no assurance that this target will be reached
Breakup of sector wise demand for non-coking coal for FY2013
Growth Drivers In Place
GW
2
Robust Expected PowerCapacity Addition
Coal / Lignite58.9%
Hydro9.2%
Nuclear
4.5%
Gas / LNG
2.1%
Renewables
25.3%
Demand Growth
from End Industries
Most of the Incremental Power
Capacity during XIIth5 Year Plan Coal Based
Large energy deficit coupled with low per capita consumption to
drive significant capacity additions in power sector
69.8 GW of additional coal and lignite based power generation
capacity targeted during the XIIth5 Year Plan
Coal is also expected to account for most of the incremental
power capacity in India
Besides power, cement and steel industries are also expected to
increase coal demand
Power
71%
Captive Power6%
Cement4%
Steel5%
Fertilisers
14%
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Source: Company data and filings As per Company data
Target Dispatches to the Power Sector as per Companys annual reports
Extensive Mining Capabilities
Exploration Mining Beneficiation
0.56 million meters of drilling achieved in
FY2013
Exploratory drilling in 67 CIL blocks /
mines in FY2013
Capacity expansion and modernization ofdrills with 31 mechanical and 4 hydro-
static drills procured in FY2013
Exploration and drilling expenses of INR
2.5billion incurred in FY2013
462 mines owned
169 open cast mines
270 underground mines
23 mixed mines
Production in FY2013 was 414 million ton
from open cast mines and 38 mi llion ton
from underground mines
Operates 17 washeries
5 non-coking coal beneficiation facilities
with feedstock capacity of 17 mtpa
12 coking coal beneficiation facilities withfeedstock capacity of 22 mtpa
3
312
333 328
342
298304
312
345
95.5%91.4%
95.3%100.9%
FY2010 FY2011 FY2012 FY2013
Target Dispatches to Power Sector Ac tual Dispatch to Power Sector % Achieved
Focus On Meeting TargetDispatches To The Power Sector
million tons
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1,187
1,443 1,472 1,452 1,425
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
Low Absolute Operating Cost per Ton Stable Average Sales Realizations
Cost Leadership Drivers
Note: Consolidated financials; FY ended 31-March; Yearly financials are audited while half yearly financials have been subject to a limited review
Indicative operating cost per ton calculated as ratio of total expenses adjusted (added back) for finance costs, depreciation / amortization / impairment, provisions and write-offs to total raw coal productionsourced from annual audited accounts and quarterly limited review accounts
Average realizations calculated as the ratio of net revenues from the sale of coal to the total dispatches during the period. The total dispatches include raw coal, washed coal, coke and other products.
Breakup of FY2013 operating expenses, excluding finance charges, depreciation / impairment, provisions and write-offs4FSAs are contractual Fuel Supply Agreements with third parties
Cost Leadership With Stable Realizations4
839
1,0391,090
1,209 1,241
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
Large proportion of mining operations through open cast mines
Redeployment of manpower and resources to more productive units,
leading to improving capacity utilizations
Employee expenses account for ~55% of total operating expenses; wage
hikes already carried out in FY2012
Utilization of equipment of larger size and capacity in order to increase
productivity and efficiency
State-of-the-art technology deployed in the open cast mines
INR per ton
FY2013 Operating Expenditure Profile
Employeeexpenses
55.4%
Contractualexpenses
11.8%
Cost ofmaterials /Inventorychange
13.3%
Power & Fuel
4.7%
Welfare
expenses1.3%
Repairs
1.7%
Overburden
Removal6.5%
Others
5.3%
INR per ton Dispatches under FSAs4 to third parties and
under e-auction comprised 85.4% and 10.6%
respectively of total FY2013 off-take volumes
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17.2
23.5
27.6
12.0 10.7
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
189,286
246,746277,574
120,851 114,138
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
EBITDA
EBITDA and EBITDA Margin (%)
ROAE (%)
EPS and EPS Growth (%)
Dividends Declared & Payout Ratio
Note: Consolidated financials in INR millions; FY ended 31-March; Yearly financials are audited while half yearly financials have been subject to a limited review EBITDA (unaudited) has been calculated by adjusting (adding back) the finance cost, depreciation / amortization/ impairment, provisions, write-offs, prior period adjustments and extra-ordinary items. EBITDA
includes other income and is net of overburden removal expense
ROAE calculated as the ratio of Profit after taxes to the average shareholders equity for the current and the prior fiscal year; ROAE for H1 FY2014 has been calculated as the ratio of profit after taxes to
average shareholders equity as of Sep 30, 2013 and Mar 31, 2013 and annualized
Positive Margins and Returns
24,634
63,164
88,429
23%43%
51%
FY2011 FY2012 FY2013
Dividends Declared Dividend Payout Ratio (%)
5
36.8%
40.1% 39.0%
34.2%
26.2%
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
Coal India ranked #2 in Coal and Consumable Fuels globally by Platts in 2012 on the basis of its financial performance
INR millions
INR millions
INR per share
3.9 10.0 14.0DPS
(INR per
share)
34.4% 35.3% 36.0% 34.3%
EBITDA Margin (%)
31.5%
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In accordance with the provisi ons of our Articles of Association, the President of India, acting through the Ministry of Coal , is in the process of appointing Independent Directors on our board of directors to
replace certain independent directors who have retired. However, depending on the timing of such appointments, it is possible that we may not be compliant with the requirements of Clause 49 of the Listing
Agreement until such appointments are completed.
Qualified and Experienced Leadership Team5
Executive
Non-
Independent
Directors
Post-graduate in Chemistry and Economics, with a post-graduate diploma in Forestry
IAS officer of the 1986 batch, with wide international
exposure
Prior to this, was the CMD of SCCL and took the company
to a higher growth trajectory
Sh. S. Narsing Rao
Chairman &
Managing Director
B.Tech. in Mining from ISM, Dhanbad
Member of MGMI, IMMA and
Institution of Engineers
Has more than 33 years of experiencein coal mining industry
Sh. N. Kumar
Director, Technical
Post graduate degree in social work
from Madurai University
Has more than 30 years of experience
in the human resources department
Sh. R. Mohan Das
Director, Personal &
Industrial Relations
Member of the Institute of Chartered
Accountants of India
Has extensive experience in
managing the finance function, across
companies, including stints at CCL
and BEML
Sh. A. Chatterjee
Director, Finance
B.Tech. in Mining from ISM, Dhanbad
First Class Certificate of Competency
under the Indian Mines Act
More than 35 years of experience in
the coal mining industry
Sh. B. K. Saxena
Director, Marketing
Government
Nominee
Directors
Has held various positions in
Government of Kerala and
Government of India, including as
Joint Secretary in Cabinet Secretariat,
Ministry of Panchayati Raj & Ministryof Tribal Affairs (Govt. of India)
Dr. A. K. Dubey
Additional Secretary,
Ministry of Coal
Also serves as Joint Secretary &
Financial Advisor to ministries of
mines, corporate affairs, youth affairs
& sports
Has held senior managerial positions
across various ministries /
departments in the Govt. of India
Smt. Sujata Prasad
Joint Secretary &
Financial Advisor,
Ministry of Coal
Independent
Directors
Worked as Secretary,
Ministry of Coal and
Joint Secretary in
Ministry of Defence
Introduced GCV
based grading /
pricing in coal industry
Sh. Alok Perti
Independent
Director
Has served the State
Government of Uttar
Pradesh in various
capacities, including
Principal Secretary
and Director General,Training
Dr. R. N. Trivedi
Independent
Director
Member of ICAI
with wide
experience in
taxation and
finance consultancy
Sh. K. R. Gupta
Independent
Director
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Organizational Commitment to Sustainable Development
Social
Environmental
Safety
Coal Indias Resettlement & Rehabilitation Policy 2012 provides flexibility to deal effectively with
issues and determine packages suited to local needs
Policy accords high priority for m inimizing disturbance of the local population while
operating new mines and expanding existing mines
CSR initiatives principally focused on project affected persons and persons living within 25kmradius of project sites
Allocated INR 5.96bn to fund CSR activities in FY2013, actual spent of INR 1.4 billion in FY2013
Development of community infrastructure: 536 schools, 86 hospitals with 1,524 doctors and
5,835 hospital beds and 423 dispensaries as of March 31, 2013
53 units and 3 entire subsidiaries are ISO 9001 compliant, 57 units and 2 entire subsidiariesare ISO 14001 compliant and 19 units and 2 entire subsidiaries are OHSAS 18001 compliant
Started satellite surveillance for land reclamation and restoration of open-cut mines
Planted 1.59m saplings during FY2013 and has planted 78m trees since inception
Various measures to reduce environmental pollution
Dust control with fixed / mobile water sprinklers at stock yards and roads
Treatment of water effluents from open-cut mines
Eco-friendly technology in open cast and underground mines
Introduction of belt conveyors, pit head railway sidings to reduce road transport
Structured multi-disciplinary Internal Safety Organization (ISO) to monitor implementation ofCILs Safety Policy
Multi-level safety monitoring agencies (from mine level up to ministerial level)
Annual and long term safety plan at the beginning of every calendar year
Higher mechanization of mining operations / adoption of best-in-class safety practices
More number of surface miners to avoid blasting operations, man riding systems,mechanization of drilling for roof bolting etc.
Continuous improvement in overall safety performance. Reduction in number of fatalities from 92
in CY2010 to 56 in CY2012
Working towards
increasing
acceptability of
mining practices
6
Source: Company data and filings as on 31stMarch 2013
Units are defined as mines, hospitals and workshops
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Key Initiatives and Expected Outcomes
Enhancing availability / accessibility of resources
Reducing costs and improving efficiency
Removing logistical bottlenecks
Stable average price realizations
Increasing acceptability of mining practices through
social, environmental and safety initiatives
Continuous growth
Cost leadership
Operating efficiency
Sustainable
development
Profitability
1
2
3
4
5
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IV. Financial Summary
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Total Revenues
551,014
699,523770,494
352,374 362,863
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
Net Income
EBITDA and EBITDA Margin (%)
Dividends Declared & Payout Ratio
Note: Consolidated financials in INR millions; FY ended 31-March;Yearly financials are audited while half yearly financials have been subject to a limited review
Total Revenues include Revenues from Operations and Other Income
EBITDA (unaudited) has been calculated by adjusting (adding back) the finance cost, depreciation / amortization/ impairment, provisions, write-offs, prior period adjustments and extra-ordinary items. EBITDA
includes other income and is net of overburden removal expense
Coal Indias Financial Performance (1/2)
108,674
147,882
173,564
75,473 67,834
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
24,634
63,164
88,429
23%
43%
51%
FY2011 FY2012 FY2013
Dividends Declared Dividend Payout Ratio (%)
INR millionsINR millions
INR millionsINR millions
EBITDA Margin (%)
189,286
246,746277,574
120,851 114,138
FY2011 FY2012 FY2013 H1 FY2013 H1 FY2014
EBITDA
34.4% 35.3% 36.0% 34.3% 31.5%
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Current Assets and Current Liabilities
Gross Fixed Assets
Cash, Current Investments and Debt
Capital Expenditure
Note: Consolidated financials in INR millions; FY ended 31-March;Yearly financials are audited while half yearly financials are subject to limited review
Fixed Assets include gross tangible and intangible assets, CWIP and intangible assets under development
Coal Indias Financial Performance (2/2)
683,183
874,150
996,922
266,659342,560 376,698
FY2011 FY2012 FY2013
Current Assets Current Liabilities
460,191
592,372632,307
15,210 15,274 13,053
FY2011 FY2012 FY2013
Cash Debt
458,064582,028
622,360
387,713
409,998
425,066
FY2011 FY2012 FY2013
25,397
37,272
29,152
FY2011 FY2012 FY2013
INR millionsINR millions
INR millionsINR millions
2,127
10,3449,947
Current Investments
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V. Appendix
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Appendix A:
Corporate Structure
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Subsidiary Wise Coal Mine Distribution
Corporate Structure
ECL23%
NCL
2%
SECL19%
WCL
18%
MCL
6%
CCL14%
BCCL
17%
NEC1%
Underground Opencast Mixed Total
ECL 87 17 1 105
NCL 0 10 0 10SECL 64 23 1 88
WCL 42 39 1 82
MCL 11 16 0 27
CCL 25 42 0 67
BCCL 40 19 20 79
NEC 1 3 0 4
Total 270 169 23 462
Mini Ratna
Central
Mine
Planning &
DesignInstitute
Ltd.
Eastern
Coalfields
Ltd.
Northern
Coalfields
Ltd.
South
Eastern
CoalfieldsLtd.
Western
Coalfields
Ltd.
Mahanadi
Coalfields
Ltd.
Central
Coalfields
Ltd.
Bharat
Coking
CoalLimited
Coal India
Africana
Limitada
100%
90% 10%
100% 100% 100% 100% 100% 100% 100% 100%
Data as of 31-Mar-2013; Breakup of mines across subsidiaries based on company data and not
independently verifiable
http://www.google.co.in/url?sa=i&rct=j&q=Coal%20India&source=images&cd=&cad=rja&docid=b12JiywPgHxLpM&tbnid=29JGcunFIp1X-M:&ved=0CAUQjRw&url=http://en.wikipedia.org/wiki/Coal_India&ei=xVcGUrDJFMKErAeP-4CoDQ&bvm=bv.50500085,d.bmk&psig=AFQjCNFpb2eCDQorbxxMCLSe6tXte4MVIg&ust=1376232907619497 -
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Appendix B:
Key Risks
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Coal Indias business operations are subject to various risks inherent to mining activities that could lead to injury including fatalinjury of personnel, damage to properties, environmental pollution and degradation, all of which may impact the corporate image of
Coal India
Coal Indias business performance is dependent upon other stakeholders / authorities
Coal India depends on rail and road transportation to deliver coal to its customers and any delays in implementation and
shortage in availability of the transportation infrastructure might adversely affect coal off-take
Delays or failure in acquiring land (and associated surface rights to access coal reserves) and obtaining forest &
environmental clearances from authorities may lead to project delays and non-compliance that could result in mine closure or
incurring fines
Coal India and its subsidiaries are subject to trade union activity and labor disputes that could lead to loss of production and / or
increased costs of production
Coal India, its subsidiaries and employees are involved in legal proceedings which, if determined unfavorably, may have an
adverse impact on the results of operations, financial condition and reputation
Coal India has policies and procedures against employing child labor in all of its facilities. However, illegal external community
mining and collection of materials (including by children) is a risk that may affect the Company
Coal Indias operations and production volumes may be subject to seasonal changes, particularly during the first half of the fisca l
year with rains / high temperatures restricting ability to carry out mining activities
Coal India sells coal at prices that are lower than the prices in the international coal markets
Coal India may be subject to penal actions by regulatory and statutory authorities in India, in the event that Coal India is unable to
comply with the provisions of any applicable law, including terms of the Listing Agreements that it has entered into with stock
exchanges in India
Key Business / Social / Environmental Risks