Good day, ladies and gentlemen, and a very warm welcome to Coal India Limited Q1 FY 2022 earnings conference call hosted by DAM Capital Advisors Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vishal Chandak from DAM Capital Advisors. Thank you, and over to you, Vishal. Thank you very much, Ali. Ladies and gentlemen, good afternoon, and welcome to Q1 FY 2022 earnings call for Coal India Limited. I would like to thank the management of Coal India for providing us with the opportunity to host them for this call. From the management, we have the CMD, Shri Pramod Agrawal, Director Marketing, Shri Tiwary, and Director Finance, Shri Samiran Dutta, and Company Secretary, Mr. Viswanathan. Without much ado, I hand over the floor to Shri Pramod for his opening remarks, following which we will open the session for the Q&A. Over to you, sir. Thank you, Vishal. It's a pleasure. Good evening, friends. It's a pleasure to interact with you people again. Our first quarter results are out. Our dispatches, our production, despite all the constraints of COVID, have been good. This was a particularly difficult quarter for Coal India, because in all these three months, COVID affected our every stage of operation. Despite that, our production was almost the same as it was last year, and dispatches were substantially higher compared to last year, and it was even higher than 19-20. We were expecting some better results in the sense that I was expecting that profitability somewhere near INR 3,600-INR 3,700, but because of some provisioning for gratuity, et cetera. Provision for? For medical. Yes. Post-retirement medical benefits, which we had not provided for a few years. For that, INR 600 crore was provided, and because of that, our profitability got reduced slightly. From this quarter onwards, I hope that our performance will be even better. Without going in much detail, we have to place everything on our website, and our presentation is there on the website. It will be better for me to answer your questions rather than giving a longer opening remark. Thank you. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Pinakin from JP Morgan. Please go ahead. Yeah. Thank you very much, sir. My first question is on e-auction, realization of e-auction prices. Can you give us a sense where are e-auction prices at this point of time in August versus the June quarter average? June quarter average was slightly less. There are two things. One is dispatching, and another is booking things. If we see the June quarter dispatch figure, that was slightly less just because whatever we dispatched in June quarter was mainly what was booked in December of the third quarter and fourth quarter of last year, and the figure was something like INR 1,569 per ton. The average realization was about 10% more than the notified price. In August, et cetera, now we are getting 30% over our notified price, and these figures will now get reflected when we will dispatch it safely. Sir, when you say 30% over notified price, would it mean an e-auction price of roughly INR 1,700, INR 1,800 a ton? I think so, yes. Understood. Sir, my second question is on the wage expense bill. How should we look at the quarterly run rate for the remainder of the year versus what it is right now? In this quarter, the wage bill, et cetera, has increased by 8%. As I mentioned in my opening remarks, which was mainly because INR 600 crore increase was there because of some provisioning of CPRMSE, post-retirement medical facilities for the non-executives. This was one-off. I don't expect any provisioning. My wage bill should remain practically in the same range as it was last year, or maybe one or 2% increase. Understood. Thank you very much, sir. Thank you. The next question is from the line of Meera Midha from Edelweiss. Please go ahead. Hi, sir. I have just two questions. What is the current state of receivables? Okay, the other question. Sir, the second question is on the cash flow from operations and CapEx. What is the CapEx for this quarter, and what do we anticipate for the year ahead? Okay. The first question, the receivables at the end of the last year was INR 19,600 crores, which reduced to INR 18,500 crores by the end of June quarter. By the end of July month, it has come down to INR 17,100 crores. That is the net receivable. It has come down by out INR 2,500 crores in these last four months, and we will try to reduce it further in coming months. We are putting constant pressure on our buyers. On CapEx this year, we have a target of about INR 17,000 crores. That includes the CapEx in HURL and TFL, which is Talcher Fertilizers Limited and Hindustan Urvarak & Rasayan Limited. In that, some part will be our contribution as equity and another part, 60% of that, means if we invest about INR 1 and INR 2 will come from the banks, and that will be included in this CapEx. That is the CapEx we are planning for. Sir, what about the CapEx for the coal companies? What are the numbers over there? The INR 17,000 includes everything. I think about this HURL and TFL will amount to about, I can't give you the direct figure, but it will be in the range of INR 3,000 crores. Rest of the INR 13,000-INR 14,000 crores should come from coal companies. That INR 13,000-INR 14,000 crores also includes about INR 1,500 crores to be spent on the rail lines that are being constructed with the help of joint venture companies. Okay. Thank you so much, sir. I'm done. Thank you. The next question is from the line of Noel from Ashika Group. Please go ahead. Hello. Yes, I just have one question relating to coal prices. So far, I think you have already mentioned that the auction premiums for August have been quite firm. The thing is that, globally speaking, still coal prices have remained quite elevated. I mean, even for that matter, coking coal. Hello? Yeah, please repeat your question. Okay. Yes. The auction premiums, as you have mentioned, have come back a little bit in August. For certain segments, even for that matter, like coking coal, we are still lagging the international benchmarks. Is this for any particular reason, or will it just normalize as well? The question is not clear. If I have understood correctly. Director, Finance here speaking. Yeah, please. If I have understood correctly, you are asking whether this auction price realization betterment is due to the international benchmarking or due to normalization of the domestic market. No, as in, can it improve further? That's what I was trying to find. Can it improve further? That is not the question. I think you are asking about the premiums which have been fetched during this quarter. That is April, May, June. Yes, sir, this quarter as well as the coming quarter. Yeah. This quarter, as I mentioned, it was nearly 30% average. In coming quarter, in the second quarter I think it will be in the same range, but in third and fourth quarter, if everything remains normal, it will further improve. Okay. Yeah, that is all I wanted to ask. Thank you. Thank you. The next question is from the line of Indrajit from CLSA. Please go ahead. Hi, sir. Thank you for the opportunity. If I remember correctly, in the last call you mentioned about a chance of price increase in the FSA segment. Where are we on that, and what is the kind of increment that we can look for in the next few months? We are working on that. Because of the first three months we lost in the COVID, so we could not at that time of that minute think of increasing the price. Now we are working aggressively on that. Since I can't tell you what will be the figure because we have not decided and should not be disclosed either. You will see some decisions being taken soon. We will try to maintain the EBITDA at roughly in the range of 30%. Sorry, EBITDA at the range of? 28%-30%, also. Okay, that's helpful. Secondly, sir, this quarter onwards, we'll have to start making the provision for wage for attrition. What is the kind of increment we will be factoring in, just for accounting purpose? I know actual numbers could be different, but when you make provisions, what is the kind of hike will you be building? We have not seriously thought about it. It will not be anywhere near what it was during last year, last time. Provisioning will be very less. Let's see, but I think let's wait for a few days for us to decide on this thing. Sure. Thank you very much. Thank you. The next question is from the line of Falguni Dutta from Jet Age Securities. Please go ahead. Yeah, good afternoon, sir. I just wanted to know what is the production and sales guidance for this year? The target we have kept at 670 and 740. To my mind, if we achieve some production of 630- 640, and a dispatch of about 600- 700 pipes, that will be the most practical thing. Okay. Sir, how should we look at the stripping adjustment line item in the P&L account for this year? I think there will not be any withdrawal or any provisioning. Stripping ratio, we will try to maintain which is required as per the design, so that it doesn't affect the production and quality in the coming years. Stripping activity adjustment, that line, will we have a positive figure? If you can give some sense on that. There will be hardly any provisioning or any withdrawal from that. Okay. Sir, any view on the contractual expense? How should that be looked at for this year? It will very much depend on what is the price of the diesel. In this quarter, we lost about INR 700 crores because diesel price increased by about 25%. It was in the range of INR 66, INR 67, and now it is in the range of INR 89. There has been substantial increase in the diesel price. If this price remains constant, then whatever we have done in the last quarter will maintain. If diesel price increases further, which to my mind seems completely unlikely, but nobody can comment on that. Okay. Thank you, sir. That's all from my side. Thank you. The next question is from the line of Rahul Modi from ICICI Securities. Please go ahead. Thank you, sir, for the opportunity, and congratulations on good volumes. Sir, a couple of questions. Just wanted to check with you on how the demand situation has been overall for both coking and non-coking. Obviously, we've seen a good set of volume numbers in Q1. How is the volume looking forward in the next few months as per your estimates in terms of offtake? When do you look at stepping up the pedal in production? Couple of months back, we had a situation where we had to also slow down production because of inventory. How's that now panning out, sir, overall? Thank you, Rahul. Demand is very good today. Actually, in the first four months, we have reduced our inventory by 45 million tonnes, and our dispatches till this date is about 46 million tonnes more than last year. It is much higher than the 2019-2020 figure as well. The demand is very huge, and it is likely to continue. Unless something related to COVID happens, our demand very likely to continue. We have created space for another 50 million tonnes. The production reduction that we resorted to last year, I don't think there will be any situation like that in coming months. This year it is unlikely to come. We will have to gear up our production and increase it as much as possible, because we have already created a space for about 50 million tonnes. As you know, in remaining days of August and few days of September, the stock is likely to reduce further. There is a huge demand in the market. Infrastructure systems are quite geared up, and so it is for us how much we produce. It's always for us. In terms of we've seen a very strong elasticity means, typically when your e-auction volumes went up to 30 million tons, obviously there was a correction. Is it more to do with the time lag of when the quantity was booked and dispatched, and you see better months coming ahead on the e-auction side? As you mentioned, there's a 30% premium. You see this continuing or improve going forward? In August and September, the premium may not increase, but after this quarter, Q3 and Q4, premium is likely to increase because international prices are firming up. The imports, unless it is very expensive, people will like to purchase from us. Now, coming to the other part of your question. You see, whatever we booked in Q1, three months, mostly that coal, in Q1, whatever dispatch has taken place is basically the coal that was booked in Q4 of last year and Q3 of last year. Because during the COVID situation, we extended the time period by about three months. Till almost 20th of July. Almost till 20th of July. Because of that, the rate in the last two quarters was not as good as it was in the first quarter. This will get reflected from now onwards. I think from September month onwards, whatever lifting takes place, it will be because of the new booking, so we should see better price realization. Right, sir. That's helpful. Sir, secondly, now how do we stand in terms of is Ministry supportive of a price hike? In terms of a lot of discounts to be offered, has been already given by us. For example, the performance incentive has been let go of, which we used to get for supplying higher than the ACQ. We had reduced the base price of e-auction. Now that your end user industries are increasing their prices, is the Ministry okay with that, basically, for allowing you to take a hike? That becomes an important thing. What is your view? See, coming to the base price of auction, now it has been restored in most of the cases. We are providing some premium right at the beginning. We are adding some premium at the best price only, and there is no opposition from any quarter. Whatever opposition is there, we are tackling that. Coming to the price rise, we are in discussion with all the stakeholders. In general, everybody is on board because our costs have increased everywhere, so there's no reason that Coal India should not increase the price. Sure, sir. Sir, now, if you could throw some light on the solar manufacturing that we were looking at. Sir, anything that we've firmed up yet on that, and the 3 GW of solar utility installations that you were talking about. Sir, how are things progressing on that side? We have got the order for 100 MW in Gujarat. In our own area, we are targeting to install about 250 MW, out of which over 100 MW has been tendered out. We are working actively on that, and in the coming months we will see Coal India participating in whatever opportunity comes. We are quite sure that by 2023, 2024, we should install about 3,000 MW of solar power. Right, sir. Manufacturing? Solar manufacturing, nothing has been firmed up. We are working on that. PLI scheme of the government has been launched. There, as I've told many times, that will go only if we get a very strong partner along with us. Otherwise, it will be difficult for us, Coal India, to venture into it. Okay, sir. Lastly, from my side, it's a very clichéd question we all always keep on asking you. Sir, thoughts on your dividend policy going forward, sir. How do you see, with the balancing act between the CapEx and the payouts, please? If the things as they are moving, if they go as such, then we will have adequate cash for both dividend and for the CapEx. There will be no shortage of cash with us. We have got INR 17,000 crore in the market, which we are realizing very fast. We have got deposits. Sir, the profitability will rise in coming quarters, so the liquid cash will be generated. For dividend policy, since new director of finance has joined, I request him to comment because I have been replying this for many months. Yes, sir. Sir, just a request. Could you stay connected? It seems the line for the management has got disconnected. I'll just reconnect them. We have the line for the management reconnected. Sir, you may please go ahead. Okay. Rahul, the second part of question, I have requested the Director of Finance to answer. Sure. Yeah, sure. I think Sir has already stated that going by the current status of our production of state and the realizability that we are having. We are expecting much better profit stability than the previous year, and going back to that normal position of what used to be for Coal India of about 28%-30% of EBITDA margins. Having said that, and because the cash position looks also good, there is no reason why we should not be able to actually maintain a good dividend rate that we have in the past also maintained, and better than what we have in the last financial year. Okay, sir. Thank you. That's very helpful. Thank you, and all the best. Thank you. The next question is from the line of Aniket Mittal from Motilal Oswal Financial Services. Please go ahead. Yes, thank you for the opportunity. My first question was on the production decrease that we've seen. I think, like you mentioned, it's largely because of the high levels of inventory that we had. Just wanted to understand from an FY 2021 end perspective, what sort of inventory levels would you be targeting, or what sort of inventory levels would you be comfortable with? The comfortable number for inventory should be about 70, 75 million tons. Anything between 70-80 million tons. In case the listing is not proper, we can go up to 100 million tons, but beyond that it will not be good to store. This year also, if you see, in first four months, we have reduced the inventory by 45 million tons. In the situation when on April, May, June, COVID situation was prevailing and the demand situation in the country was slightly below normal. In case the demand situation remains normal type, then even 100 million ton is something which I consider comfortable. Because in these three months, with all the efforts, the dispatches do not reach go beyond 2 million tons. During the rainy season again, the movement of the coal gets affected. Actually, it is advantageous to have slightly better. Okay. Sure. From an FY 2022 end perspective, the inventory levels that you'll be targeting will be roughly 70 million- 80 million tons. That's right. Okay. Our current inventory, I think at the end of July would be 54 million tons at our mines, right? Please continue. Sorry. Correct me if I'm wrong, I think at the end of July, the inventory level at our mines would be close to around 54, 55 million tons. Going forward, I think we would look to increase the production versus dispatches. How easily can we do that? I couldn't get your call. How? I was saying our current inventory levels, I think at the end of July would be close to 54 million-55 million tons. If at the end of the year, we want to reach the number of 70 million-80 million, we're essentially talking of the production outpacing the dispatches. Right? Which means the production at our mines will have to increase, going forward at least for the next few months. That happens because in the last quarter, we produced almost 35% of our total production, if I'm not wrong. In March alone, we produced about 12%-13% of our production. Okay. Sure. That will happen in March. All right. Just to get a sense, and sorry to harp on this, but if I were to look at Coal India as a whole, what would you say would be the annual production that you can reach for all your mines without incurring any further CapEx? Without incurring any CapEx, maybe this year we can achieve whatever we are desiring to, but next year it will not be possible to sustain that because one of the major component of CapEx, acquiring land and doing rehabilitation work. Third thing that we are looking at are evacuation system. Unless we invest properly in these four concepts, three or four items, maintaining this production will be very difficult. It will start going down very fast. Okay. I think the target was 630 to 670. If I look Coal India as a whole, we can easily do 630 million to 670 million tons. Beyond that is where we would face challenges, where we require to acquire land, and that's why we're doing the incremental CapEx. Maintaining this thing will require acquiring land. Okay. Sure. Whatever land we acquire, it is not something that we have acquired complete piece of the land. We acquire land every year. Like last year, we acquired something like about 3,000 hectares of land at the cost of about 3,000 hectares gross. That type of acquire, we have to keep on acquiring the land. Got that. Understood. Just on the OBR front as well, I think what's happened over the past one year is, because our inventory levels were high, we were sort of focusing more on the OBR front rather than the production of the mine. How do you see that going forward? Any sort of OBR production numbers that you have in mind for FY 2022 or OBR removal numbers rather? OBR removal partly was because of the fact that you mentioned, but partly was also because of the fact that in the last three, four years till 2019-2020, despite increase in production of the coal, OBR number have remained in the same range of 1,130, 1,140. That has affected the mine geometry tremendously. If we want that quality of the coal should improve and we want that production should increase more, then OB removal at the rate of about 2.5 x of the tonnage is essential. If suppose we are doing production of 600 million tons, roughly in the range of 1,400-1,500 million cubic meter of OBR removal is essential to maintain the mine geometry. I think in this year also, we will target for something like 1,550 or 1,500 million cubic meter of OBR removal. Sure. That is helpful. Just one question, on the e-auction front going forward. Once our inventory levels, I think, keep on declining, I think the realization on the e-auction will also go up. How do you look at the overall mix? In terms of your overall dispatches, what would the ideal percentage be in terms of the e-auction volumes that you're looking from a full year perspective? Q1 was a pretty good number in terms of, I think 20% of our dispatches e-auction. Would we be able to maintain that if realization start going up? We would maintain that. Actually, 53 million ton of coal stock is not a low stock. This must be one of the highest stock on 15th of August, as on this date in any of the last year. There will be no shortage of coal at the mine level, and from October onward, the accretion starts happening in the stock. There will be no shortage. What I mean to say that e-auction volume will not get affected because of shortage of the coal. If there is a demand, we will try to maintain this 20%-25% level. Thank you. Just one follow-up on that. Could you tell me what are the overall e-auction levels or e-auction volumes that you've booked, and out of that, how many have you dispatched? I don't get that your whole question. Sir, I was asking how much volumes of e-auction coal have we booked or contracted, and how much of that have you dispatched? It is not that one-to-one relationship. The auction that took place in the last quarter basically got dispatched in the first quarter. The auction total was about 23 million tons, and the dispatch was 30 million tons. This 23 million tons has got nothing to do with this 30 million tons. Only a part of this 23 million tons would have got dispatched in this 30 million tons. Most of it was what was the auction in the last year. We did about 125 million tons last year, and I'm pretty sure that we will exceed that number this year. Understood. Thank you, sir, and wish you all the best. Thank you. The next question is from the line of Indrajit from CLSA. Please go ahead. Sir. Hi. Sorry, I just missed your production and sales guidance numbers for the year. If you can repeat that, please. I was saying that dispatch should be in the range of 710, 720, more than 700. The production figure, if it is more than 640, 650, I would be happy. It should be in the range of 645. Okay. Thank you so much. Thank you. The next question is from the line of Kamlesh Bagmar from Prabhudas Lilladher. Please go ahead. Yeah. Thanks, sir. Sir, one question on the part of e-auction. Sir, I'm just considering the spot e-auction. Your voice is not clear. Can you bring your mobile closer to your mouth? Hello. Yeah, that's clear now. I was asking on the part of e-auction, sir. If I see July, your e-auction realization on the basis of numbers which were reported on the Ministry of Coal, it was roughly around INR 2,100 odd. If I compare it with January 2020, it was similar, INR 2,200 with the same notified price of roughly around INR 1,500 odd. If we see the global coal prices, it has almost more than doubled or 2.5x. Our realizations in the spot e-auction stream continues to remain the same. Even if we see the quantity at, in July, we have offered hardly around 5 odd million tons, and we were able to get interest for only around 50% of quantity. What is the reason behind that, sir? When there is so much of buoyancy in the global coal prices, even pet coke prices, they are almost at, like say, all-time high level. We are not able to realize that in the spot e-auction. I'm not comparing it other auctions, like say, power and all that, because there will always be weak realizations or soft realizations in those segments. Particularly on the spot e-auction, like say, it continues to remain very tepid, even like say, after a sharp increase in the global prices. I'll refer back to marketing, who's sitting with me to reply on this. A very good evening to the querist. You understand that a spot market is for short-term lifting. As Chairman Sahab have already told you, that the lifting which was being taken was from the booking of the previous years or previous quarters. That is why the coal which was being held till the 20th of July, that was getting lifted, and the interest for fresh booking was not there because the coal was there in the hands of the traders. Once this extension time is being taken out, you will find that this will shoot to a level of around 75% or 80% of premium. Have I made my point? That earlier booked quantity was still there in the market, so there was a less interest in booking the fresh quantity. I was only talking about the July month. Yeah. It is there. Up to 20th of July, there was an extension of date. Once this coal which was booked earlier goes away, you will find the interest rising much beyond what you have seen right now. Let me tell you, spot auction, if I see on an average thing for April to July, it is 34%. In a similar pattern, when we offer coal for special spot auction for importers, the premium is 54%. On average, what Chairman Sahab had said, it is hovering around 34%. If I take the sector which is almost in the same pattern of spot auction, for importers, the premium is 54%. What I'm trying to tell you is, if this coal has been lifted for the last quarter, now you will see from next month onwards, the spot auction premiums will be much, much higher than what you are seeing right now for July or even for the average of April to July. Okay, sir. Thanks a lot, sir. Second question on the employee cost. I was not able to hear that properly. How much was the one time this quarter in employee cost, sir? There was an increase of. Okay. Director Finance wants to answer this. You see, in this quarter, you have seen an employee benefit cost of total INR 10,390 crore. We have already said that within that is embedded that INR 600 crore, one of actuarial valuation, non-cash charge, that provision we have made. Even if you knock that off, it comes down to something below INR 10,000, something around INR 9,500-ish or INR 800-ish, which you had seen even in the one year back period. If you multiply it by four, that gives something around INR 36,000-INR 37,000 crore, which is more or less on the same line as was in the previous year. As you know that almost 15,000 people goes off. It gives us, as per the present rate of salary structure, almost INR 1,400-INR 1,500 crore of saving. After recovering that, whatever the increments are there for 3% annual increment and the DA, that more or less keeps the salary and wages in intact with the previous year. This year also, we are witnessing that the DA has been quite less. I mean, the inflationary pressures and the reflection through this dearness allowance has also been less. We don't expect that it should go on an overall basis beyond what you had seen in the last financial year. Would there be any impact because of the increase in the DA, which has been done by the Government of India for the central PSU employees? Yeah. For officers, there has been increase in DA by about 5%. You know that in Coal India, there are 250,000 employees. Out of that, only 17,000 or 18,000 are officers, and rest of 230,000 are workers. The impact that it will make will be not very significant. It will be there. Their DA was not frozen. That was continued. The DA of non-executive was not frozen. It continued. Because of this, there is unlikely of any much of a great impact. Okay. Thanks a lot. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Pulkit Patni from Goldman Sachs. Please go ahead. Sir, thanks for taking my question. Just harping on the previous question, just so that I understand this correctly. Samiran Sir explained that employee cost is going to remain in the same range as last year, given the adjustments, the DA adjustments. If one factors in the provision for wage revision, obviously this number is going to be higher, right? Is that understanding correct? That's right. Without wage revision, it will be in the same range. What Samiran said that it was last year in the first quarter, it was INR 9,600. This year in this quarter, it is about INR 10,400. Out of that increase, INR 600 was a provision thing, which was one-off. If that is knocked off, it is almost in the same range, INR 9,600-INR 9,700. That's likely to continue in the coming months. If there is a provision, there will be provision for that. That provision will be extra. Yeah. I just wanted to clarify that. Thank you, sir. Thanks. Thank you. The next question is from the line of Rakesh Vyas from HDFC Mutual Fund. Please go ahead. Yeah, hi. Good afternoon, everyone. Thanks for the opportunity. I hope everyone is safe. I have two clarifications and two questions, sir. First one, on the employee cost itself. When we are guiding for a flat kind of number on YoY basis without impact of wage hike. I believe even in last year, in fourth quarter, we had made certain provisions for actuarials, et cetera. Are we accounting for those numbers as well, or we are negating the two, the provision made in this quarter versus fourth quarter? See, our numbers should be 9,700 on average per quarter. Okay. Last year, we made a provision of about INR 1,000 crore in the last quarter for that leave encashment. Yeah. This year, suddenly it has come up about INR 600 crore for post-retirement. If you knock off those things, it will be almost same. Whatever one-off provisions are made, if those are removed, it will be almost same. Got it, sir. That helps, clarification. The second question is on the spot e-auction. Just want to clarify something that Director Marketing was highlighting. Essentially, July also saw a muted response because there was lot of offtake available with the already booked quantity with the players, which was taken off. What we are essentially highlighting is that since then, since 20th July, because that window is closed, the incremental spot auctions is seeing a much higher premium of 70% odd. Is that a correct understanding, sir? Is that what I heard? 70%, what you mean to say, that till 20th July, we had given time extension to all the coal trader just because the COVID situation was prevailing till June, so we gave them 15, 20 days extra. After July, there is no extension, so whatever quantity was left with them is over. Now onwards, for coming forward, we must see a much higher premium on this. Okay, got it. Two questions that I have, sir after this last beginning. One is on the, you are talking about almost 640 million tons of production kind of number and 700 of offtake, which essentially means that you will probably be having a reasonable moderate inventory at the end of the year. Given that demand remains strong, how prepared are we for a much higher production number and offtake number in FY23? Are there some bottlenecks which we still need to address to achieve those? FY 2023, the constraint that I personally feel is mainly related to evacuation. About production, we can say that we have created capacity which is much higher than this. We have contracted about 130% of our requirement. That even if one or two contractors fails here, we have created some flexibility in our contract system also. If one or two contractor fails here and there, it should not affect our production numbers. Evacuation is definitely one of the big challenge, we are following it up very seriously as we know that almost all the FMC projects are under construction. Some of them will come in next financial year. That will help us in evacuation. Many of the lines that is small line, sidings, etc., that were under construction, we are following them up. Some of them will get constructed, but that will also help in increasing the some dispatches. One major improvement that is likely to take place is completion of Angul-Balram line completed. About 20-25 rakes means about INR 1 lakh per day. That is about 100,000 dispatch from MCL will become possible. From Sardega, they are widening the platform, and they are creating Sardega-Jharsuguda line has started construction. Construction has started in that line. We have taken up some small patches work immediately, which are very critical for improving the dispatches. With that also, another 40,000-50,000 tons will come per day. We have started construction on Tori-Shivpur line. Some of these patches may come, and that will help us in improving the dispatches. There may be some problem here and there, but then there will be no such constraint that we will be not in a position to meet the demand. Got it, sir. My last question was related to this part only. Of the first mile connectivity projects, if you can just also highlight as to almost 400 million tons kind of number that you are targeting in phase one. How is the commissioning of these likely given that we are already talking about CapEx on those numbers in 2022 and probably 2023 as well. What proportion will come in which year? If you can just highlight that as well. They will come in FY 2023. 2023. Okay. Some will come in this year also. About four to five will come this year. Most of them will come in FY23. March 2023, most of them should be there. Three of four may get delayed, and one doesn't know how the COVID situation will come in. That happens when our everything is stopped. Got it, sir. I'll get back in queue. Thank you so much. Thank you. Next question is from the line of Ajay Jain, an individual investor. Please go ahead. Hello. Good evening, sir. Sir, my query is, can you throw some light on the Jharkhand demand which we were having, and what is the progress in this? If you could quantify it, because in the last meeting, you had informed that they're going to take the rate based on present circle rate of the land. Could you just quantify a little on the whole liability which we are having on this? Mr. Ajay Jain, there is a problem with Jharkhand land records. The land we have acquired, but many of that land has not been given possession to. We have not got the possession. Secondly, a lot of land for which we have already paid to individuals, but that is in the name of Jharkhand government in some old records, and whatever payment we have made is after the verification done by the land record authorities. That is the district level officer. There is no confusion on that. We have paid last year, INR 600 crore, INR 650 crore to Jharkhand government as an advance to be adjusted against the land they are going to give. A lot of land they have provided, but a lot of land they have yet to give to us. Whatever figure that is coming, I don't think they are any realistic or anything going to happen. They're asking for INR 30,000 crore, sometimes INR 25,000 crore, sometimes even INR 50,000 crore. All those figures are not based on any complete record. They are based on many assumptions. If they make that much of land available to us, trust our mining strength will go. It will be a phenomenal growth in our production. There is no linkage between reality and this. Fair enough, sir. I understood that. Coming to my next, could we quantify from the company's point of view what you feel could be the liability which we look ahead? Somewhere we had worked out an INR 2,500 crore figure, which you had mentioned that also is not there in your mind. Because these figures are so huge, it can have a very financial difficulty, as regard the liquidity and the profitability going ahead if it comes true. Could you quantify to specify, okay, this is the liability which we feel may come up? I don't think any liability is going to come up. Okay. Whatsoever land, 200 acres of the land for which we have given them INR 600 crores, we were wrong. There may be a liability of another INR 50-100 crores or something like that, not more than that. The court needs to rule as beyond that, there is nothing in this. If they start giving us 56,000 acres of land or a segment land will be notified. Oh, wonderful, sir. This is very comforting because the figures which have been going around can really make a lot difference. Thank you. I think that. Secondly, sir, there's so much of rise in international prices. This e-auction and the spot prices gives us better revenue to the company. Do we have a cap on this that we can only do a particular amount of production can go into e-auction, apart from the ones which you have a tie-up agreement? About 20% of the total production, that constraint is only if there is no demand from regular customers. As such, achieving 20% itself has not been possible in many years. Now we have geared up, offering is not a constraint. Demand should be there. If you offer too much of the quantity, then there will be no giving on it. Availability of the coal, making a balance between the demand and supply, all these things are there. Sir, just a corollary to it. Basically right now the international prices are going, I mean, lifetime high and there's a difference between a year back and today, it has increased more than 100%, 150%. Why is this not reflecting in our prices? Whenever we see international prices, we go for a good sleep because we think even Coal India would have a good price too. When we go back, it does not reflect so in our pricing. Is there any particular reason behind it? Like you explained about the spot prices, that 20% is what we can sell, and probably we will reach that figure. Apart from that, the FSAs and are we not able to negotiate with them? Like normally, if you see other commodities, they monthly take out a price list. Okay, this is the price which we'll give from this particular day onwards, iron ore and other commodities. Why is not that happening in Coal, sir? In Coal, about 80% of prices we can modify. Modified price can increase, if the increase is tremendously, then it will affect the price of the energy, price of the power in the country. That much of freedom we don't have. Because if we increase that price furthermore, our electricity price will become almost 150% increase in the year. Okay. Then the whole country will problem. That type of thing cannot happen with essential commodities. Coal being an essential commodity, I don't think that is a practical thing and nor it is a desirable thing. We completely understand that this is a high time when the price should increase, taking into account the fact that for last two and a half years, we have not increased the price, and our stocks are collected all the way and tried to reduce it to the extent possible. I completely agree with you. Whatever we offer on the spot price in the e-auction, I think in coming months, you'll see much higher realization. Right. Thank you so much, and really compliment you on the way you conduct these concalls. Really makes things so transparent, sir. I really respect and compliment you on this particular effort which you put in, sir. Thank you, Mr. Jain. Thank you very much for the compliment. Thank you. Thank you. The next question is from the line of Vineet Maloo from Birla Sun Life. Please go ahead. Good afternoon, sir. Thank you so much for the opportunity. Sir, just wanted to know what has been the progress for us on receivable side at the end of June and beyond June also till date. If you can just talk about that, sir. I had mentioned this in the opening remarks, Maloo, coming back to it, at the end of March this year, I mean 31st March, it was about INR 19,500 crores, which will reduce to INR 18,500 crores by June end, and my Director of Finance tells me as of July end, it came down to INR 17,100 crores. There has been a reduction of about INR 2,400 crores in last four months. Sure, sir. Thanks, sir. Sorry, I think I missed it earlier. My next question is, sir, what is the total CapEx we've incurred so far in the year? Are we on track for our annual target? See, as I mentioned earlier also, the target is about INR 17,000 crore, but that includes our investment in HURL and TFL. HURL and TFL, I expect that this year about INR 1,000 crore equity will be put and correspondingly about INR 2,000 crore loan they will be taking. That INR 3,000 crore is on HURL and TFL account. Another INR 1,500 crore or INR 1,000 crore, I don't remember exactly, is for railway lines that have been constructed in eastern railway. In that also, my equity is successful, that is 64%. Out of total investment, only 20% or 30% is equity and 70% is debt. To that extent, if you are looking from the cash point of view, this fact should be taken into account. Rest of the thing is for improving our coal production. Okay. Yeah, that clarifies that. Thank you so much. Thank you. Yeah, that is from my side. The next question is from the line of Rahul Jain from Systematix. Please go ahead. Yeah. Hi, good afternoon, sir. Thank you for taking my question. Sir, we had started this exercise of import substitution, sometime last year, if I'm not wrong. Sir, how far have you succeeded on that front? What is your expectation for this year? Secondly, sir, I want to know, sir, what is the pipeline of thermal projects coming in the country? How do you see the landscape evolving in next two to three years? Yeah, thanks. I couldn't get your second question. No, this is more broad-based in terms of this carbon emissions creating a problem globally. How are we geared up to address that issue? Okay. Coming to the first question, I think about 70 million ton was the thing that we supplied instead of import last year. This year again, we will make all the efforts to replace the import as far as possible. Our limitation is that there is lot of import, which is the type of coal we don't have, like coking coal, high-grade coal, and coal for coastal power plants, et cetera. That is something which is not replicable. Rest of the coal, whatever is replicable, we'll try our best to replace that. Coming to the second part of the question, which is related to decreasing the carbon emission. We are taking all the steps possible. As I had mentioned in earlier interactions as well, that the project related to first mile connectivity and railway lines are a big step in reducing the carbon footprint. Very soon you will see a MoEFCC report put on our website that will indicate that a lot of carbon, I don't want to give the numbers exactly, but by constructing all these 35 FMCP projects, a lot reduction will take place in carbon emission. There will be a substantial reduction. Secondly, we are increasing the afforestation drive. Last year, we did tree plantation on about 800 hectares of the land and did about 20 lakh plants. This year we are planning that we should do on more than 1,300 hectares of the land and perhaps more than 30 million saplings will be planted. Besides, this is over and above the statutory requirement of afforestation that we are required to do when we affect any forest area. Whatever we have accumulated over the years is more than 4,000. I don't remember this number. [audio distortion] More than 4,000 hectares of the land we have planted. On this we have trees are planted. In certain areas, actually, the area after our CIL enters, it has become greener. All these efforts. We are doing some experiments on how to replace diesel with LNG, and we have signed an MOU with GAIL recently so that they will help us in introducing LNG. If that happens, then further reduction in high capacity equipment can be achieved. We are trying to get into the solar power. As I mentioned earlier, that about 250 MW we have identified, which will be created just to meet our requirements, which will supply to other subsidiaries directly. Besides, we are trying to enter in this field by taking up solar power projects in other areas so that in next three years, CIL can become an energy neutral company. Yeah. Thank you, sir. That's very helpful. Sir, also on how do you envisage the situation evolving, say, in five years' time? Do you see a lower production than offtake, given your projection that you would have done? Do you see that thermal demand will still continue to grow at more than 5%? What are your thoughts on that, sir? It will be difficult for me to indicate any number, but my understanding is that for next one and a half decade, the coal production requirement of the country will further increase. There is no way it can decrease. Our average energy consumption. Sorry, we take in another way, that average carbon emission per capita in India is half of the world average and perhaps 1/8 of the American average. If we have to improve the standards of the living, the energy consumption in the country will increase. There is no way that it can decrease. Next 10-15 years, I don't think the coal demand will reduce. Maybe the share of the coal in power generation will decrease, but in absolute terms, it will definitely increase. That production requirement will be at least 5%-6% increase every year. Right. Sir, likely you think it will be coming from higher PLFs because not too much of thermal capacity will be added. Is that the right assessment, sir? That's right. Last year it was only 58%. This year, in certain months, it rose to 62%. It is likely to increase. This year you will see that PLF will be 60%+. Right. Thank you so much, sir. Thank you. The next question is from the line of Vishal Chandak from DAM Capital Advisors. Please go ahead. Thank you very much, sir. Sir, just a couple of questions from my side. First question was with respect to simplification of the e-auction process. If I remember last time you mentioned that there are a number of e-auction, multiple e-auctions that you run, and that creates a lot of anomalies in the system as in who puts in how much quantity in which auction and thereabouts. Price discovery also at times is not very realistic, and demand assessment is also not very clear. Any thoughts on how soon can we move on to one company, one auction kind of a phenomenon? Vishal, we are trying very hard for this, but we need government permission for this. As you know that it will affect certain interests. Those interest groups are trying to resist, but we are working on that. It will be difficult for me to indicate the timeline, but let's see. We are working very hard on this, and it should happen. In my view, that would unlock significant amount of value for Coal India actually, because if you look at today, any other company in the commodity space, they have reported lifetime high EBITDA, while the cost structure is probably remaining flattish or marginally up. It's high time we have our share of the pie. You are right completely. Other commodity and coal is slightly different because almost everything depends on coal. Rampant increase in price of coal perhaps will not be advisable for the country's economy. I completely agree that there should be some increase, and all these mechanisms should be transparent, and it should be such that real price discovery takes place. We are working very hard on all these things. That's great to hear, sir. Sir, my second question was with respect to washeries. I remember at the time of our IPO, we had made certain commitments on setting up washeries and proceed towards improved quality of coal. In recent times, what are the actions that we have taken on washeries? If you could just elaborate on that. It was found that washing coal becomes slightly expensive, and no power plant is willing to take washed coal. Despite that fact, if you transport over a certain distance, the cost of transportation of the ash content, which makes the coal cheaper. None of these power plants was giving any commitment on this. In the last year, the government made it compulsory not to transport coal beyond certain ash content. Those notifications have been modified. In today's situation, even if I install washeries, I don't know how much demand I would get. I have been requesting power plants to indicate their demand to give some commitment, but in last many years, they have not given. Ultimately, not many washeries in non-coking coal field are likely to. Right. Sir, my last question was with respect to our CapEx for reaching at a billion tons. If I remember, we had stated that we need about INR 65,000 crores of CapEx to reach a billion ton, and we were planning to hit that number by about FY24. I understand we would be delayed because of the COVID. Where are we in terms of reaching a billion ton and in terms of capacity to produce, and how much we have spent on that so far? That would be all, sir. Last year, we spent about INR 10,000 crore-INR 12,000 crore just on increasing our capacity. This year, again, as I explained earlier, about INR 13,000 crore will be off all other expenditures. INR 13,000 crore-INR 14,000 crore CapEx will be done on this. Next year again, we are likely to do CapEx of between INR 13,000 crore-INR 15,000 crore on this item. What you are saying, that INR 65,000 crore is required to increase the 1 billion ton production. Perhaps there is some mismatch in these numbers, because when we say that so many projects are to be opened for reaching this 1 billion ton target, and for those projects INR 65,000 crore or INR 75,000 crore will be required. It doesn't mean that for 1 billion ton, this much is required. 75,000 is the total requirement of those projects over the next 20 to 25 years. That much capacity will be created, and that capacity needs to be sustained over many coming years. That is something. It is not that we require to spend INR 65,000 crores in the next two to three years to achieve this target. Got it, sir. Thank you so much. Thank you. Thank you. As there are no further questions in queue, I now hand the conference over to Mr. Vishal Chandak for closing comments. Thank you very much for participating in today's call. I hope we have had a very good session, and I hand over the floor to sir for your closing comments. Thank you very much, Vishal, for organizing this, and thank you, participants, for asking very good questions today. I must appreciate today that the repetition of the questions were not there, so we could close this well within time. Thank you very much, Vishal, for organizing this. Thank you. Ladies and gentlemen, on behalf of DAM Capital Advisors Limited, that concludes this conference call for today. Thank you for joining us, and you may now disconnect your lines.