OBJECTIVES OF THE PROJECT

 To analysis and study of departments of Central Coalfield Limited.

 The next thing is that what it does and how it does the mining work in the
States of Jharkhand?

 To find out what are the regional institutes and where they are located?

 To study the organizational setup of CCL.

 To observe how it is offering of full-range of services in the sphere of

resource exploration and development, coal preparation, utilization and
management, coal/material handling arrangement, as well as engineering and
environmental management?

 To assess how it is helping in the Engineering Services? What are extensive

experiences and methods in the Coal Handling Plants (CHP)?

 To evaluate what types of study are conducted to finalize the Power Supply.

 To examine where the Energy Audit and Energy Certification Study are done
in how many mines, plants and washeries resulting in how much saving of
power are done?

 To study and evaluate the Infrastructure & Expertise available in CCL.

 To inspect the types of tools and equipments facilities?

Page | 1
  To study the different kinds of process involved in coal preparation?

 To evaluate, based upon the company’s Balance Sheet and Profit and Loss Account
the correctness of Ratio Analysis done with its inferences.

Problems with mining coal production

PROBLEM – 1 Expensive Task

In terms of mining coal it is very expensive due to the fact that most coal deposits are
deep in the crust of the earth. This requires expensive mine construction involving
human miners that must go into the mines risking their lives. Liability insurance and
the maintaining of safety standards within the mine environment add to the cost of
extracting the coal from the ground.

PROBLEM – 2 Strip mining safer but threat to Ecology of the region

For coal deposits located at ground level, strip mining is relatively inexpensive and
relatively safe to the miners. However, strip mining upsets the ecology of the region,
and mining companies are required by many state and local communities to restore
the landscape. This is very expensive and must be considered in the total cost of coal
mining. Once the coal has been brought up from the mine, it has to be transported to
the area that it will be used to generate electrical energy, primarily in coal burning
electrical power plants.

PROBLEM – 3 Transportation costs are quite high

Transportation costs are quite high since it must be transported either by rail or ship.

PROBLEM – 4 Serious threat to the Environment and Human

Once the coal has arrived, the burning of the coal produces substances that pollute the
atmosphere. The chemistry of "burning" or combustion as the chemist describes it,
involves the chemical reaction of the carbon of coal with oxygen gas. This produces
two oxides of Carbon, Carbon Dioxide and Carbon Monoxide. If the combustion is
complete with an excess of oxygen then Carbon Dioxide is the product. On the other
hand, if there is a deficiency of Oxygen in the combustion process, large quantities of
Carbon Monoxide will result. Carbon Monoxide is a very toxic gas which will tenaciously
attach itself to Hemoglobin molecules of red blood cells and thereby prevent Hemoglobin
from carrying the needed Oxygen to the cells. Respiration is carried out by most cells in the

Page | 2
body. Respiration involves the chemical reaction of carbohydrates, protein, and fats with
Oxygen to produce Carbon Dioxide, Water and other nitrogen and Phosphorus containing by
products. If Oxygen does not reach the cells, respiration is blocked and cells die. Carbon
Monoxide toxicity can have mild symptoms of irritability, headache, or nausea, but if the
concentration of CO is higher, comatose and death will result. Even though Carbon Dioxide,
the major product of combustion of Coal, can also be toxic depending on its buildup
concentration, it is not as toxic as Carbon Monoxide.

COAL PRODUCTION IN INDIA - AN OVERVIEW

Coal is largely available in the areas situated in the valleys of rivers Son, Damodar,
Godavari and Vardha. Generally Anthracites and Bituminous qualities of coals are
found in these areas. Major portions are available in the states like Jharkhand, Orissa,
Chhatisgarh, Madhya Pradesh, Andhra Pradesh and West Bengal. The lignite quality
of coal is found in the areas of Rajsthan, Tamil Nadu, Meghalaya and Jammu and
Kashmir.

The following table shows the statistics on coal production in India:

Page | 3
 Table - A

Quantity
Year
(In lakh tonnes)

1950-51 323

1996-97 3082
Graph -
1997-98 3190
A
1998-99 3157

1999-2000 3221

2000-2001 3326

2001-2002 3526

2002-03 3673

2003-04 3892

2004-05 4130

State

Table - B

Reserves

State (In million tonnes)

Madhya Pradesh 72204

Orrisa 60984

Page | 4
Jharkhand 39975

West Bengal 27813

Chhattisgarh 19232

Andhra Pradesh 16926

Maharashtra 8582

Uttar Pradesh 1062

Meghalaya 459

Assam 340

Page | 5
80000
72204
70000 Madhya Pradesh
60984
Orrisa
60000
Jharkhand
50000 West Bengal
39975 Chhattisgarh
40000
Andhra Pradesh
27813
30000 Maharashtra
19232 Uttar Pradesh
20000 16926
Meghalaya
8582
10000 Assam
1062459340
0
Reserves

Graph - B

Page | 6
INTRODUCTION

Coal is one of the nature’s invaluable gifts to mankind. It is much more so far to a
developing country. In India, coal is power that stands for progress and prosperity and
basic raw material for energy and heating. Indeed, coal touches our lives, wherever
we are.

Mining coal from the bowels of earth is not only difficult but also hazardous against
nature involves safety, care of ecology and environment. Even before coal starts its
onward journey, the multiplier effect on growth and development becomes too
evident to be overlooked in producing coal for the Nation have contributed
significantly to the growth of Jharkhand and country at large.

We are proud to have been on the coal map of the country as a public sector for over
four decades making invaluable contribution in meeting the energy demand of the
Nation and to the socio-economic development of the state of Jharkhand.

CCL is one of the 7 Coal production subsidiaries of Coal India Limited under
Ministry of Coal and Mines. Company is governed by a Board of Directors consisting
of 5 full time Directors and 6 part time Directors. Full time Directors are responsible
for specific functions of Operation, Project & Planning, Finance and Personnel.

Page | 7
The company is incorporated under the Companies Act, 1956 and is wholly owned by
the Government of India (GOI). Engaged in the mining of coal, coal based products
and mining consultancy. It is situated in Ranchi, Jharkhand.

The activities of the company are carried out through separate divisions with specific
functions. The operational divisions comprise Geology, Drilling and Mining. Support
services are provided by Finance Division, Materials Management Division,
Personnel & Administration Division, Commercial Division and Planning Division.

BACKGROUND HISTORY

FIRST NATIONALISATION OF COAL mining

1925
by Railway Board.

Railway Collieries transferred to Coal Board Under Coal

1944
Commissioner.

Formation of Public Sector Company -  National  Coal

1956 Development Corporation Ltd. with 11 State owned collieries,
Production 3.11 M.T.

1959 First Washery of NCDC – Kargali  

1971 Nationalisation of Coking Coal Mines.  

1973  Nationalisation of Non-Coking Coal Mines

CENTRAL COALFIELDS LIMITED reorganised in

1975
November under Coal India Limited -- Holding Company.

Truncating of CCL, Formation of NCL (Singrauli) and MCL

1986
(Talcher).

Page | 8
2004 11 Areas, 65 Mines

Organisational Setup of CCL

The company is managed by board of Directors and is headed by chairman cum

Managing Director (CMD) , assisted by group of Staff Officer looking after different
departments .

The functional directors comprise of Director personnel , Director finance , Director

technical and Director operation

Chairman- cum- Managing Director : Sri R.P.Ritolia

CMD, CCL
The Directors of CCL
R K SAHA D(T) A K SINGH D(T) Dr AK Sarkar,
Ajay Kumar, D(P)
P&P OPR . D(F)

Page | 9
 

INDUSTRY PROFILE
Coal India Limited (CIL), a holding company, is a state-owned mining corporation
and the largest coal producer in India. In 1990, production was 179 million tons of
hard coal, up from 172 million tons the previous year. This comprised almost 88% of
the coal output in India. However, like many state-owned concerns, CIL's financial
performance has been generally poor, and it has made profits in only two years since
its creation in 1975. During the financial year 1989-1990 CIL made a loss of Rs230

Page | 10
million. Although this loss was less severe than those made in the period immediately
after nationalization, it marked a decline from the previous financial year when it
made a profit of Rs82 million. Coal provides more than 50% of India's energy
requirements. However, India's per capita energy consumption is among the lowest in
the world. India has vast coal reserves, and these can be mined cheaply, although the
coal is generally of poor quality and has a high ash content. In 1991, India's total coal
reserves were estimated at 176 billion tons, of which over 30 billion tons are proven
reserves, within 200 meters of the coal pit or the workings. Of the total, coking coal--
coal from which the volatile elements have been removed, making it suitable as a
fuel, and for metallurgical purposes--comprises 24 billion tons (11 billion tons
proven). The bulk of India's coal reserves are in the Bengal-Bihar coalfields in the
west of the country. Due to the structure of the coal mining industry in India, CIL's
role is a major one, and its performance and operations very much reflect the policies
and priorities of the government of India.

The Indian coal industry has its origins in the early 19th century, when mining
activity became commercial in conjunction with the expansion of the railway
network, particularly in the west of the country. The monopoly interests of the British
East India Company were revoked in 1813. Initially, the coal fields were operated by
a large number of Indian private companies which possessed captive--or company-
owned--coalfields to support their iron and steel works. By 1900 there were 34
companies producing 7 million tons of coal from 286 mines. Production continued to
grow in the first half of the 20th century, especially during World War I. Demand
continued to grow during World War II, and production reached 29 million tons by
1945. By then, the number of companies had increased to 307, and the number of
mines to 673. The trend continued for almost a decade after India's independence in
1947. However, India's ambitious economic development plans led to a tremendous
demand for energy, and in the absence of alternative sources, coal was targeted as the
major source of power for industrialization. Under the government's Second Five
Year Economic Development Plan 1957-1961, a target of 60 million tons was set for
the end of the plan period. However, government economic planners were convinced
that the private sector would be unable to meet this target. Hence, the National Coal
Development Corporation (NCDC) was formed, which took the old railway collieries
as its nucleus and opened new mines as well. Production of coal increased from 38
million tons in 1956 to 56 million tons in 1961.

Page | 11
Financially, the subsidiaries of CIL have an average authorized capital of Rs1.5
billion each. Each employs between 100,000 and 180,000 people, and has an annual
turnover of between Rs1.1 and Rs1.7 billion. Their shares in the total production of
coal vary from 25% for the Central and Western Coalfields, and about 20% for
Bharat Coking Coal and Eastern Coalfields. The financial performance of the
subsidiaries varies. BCCL made cumulative losses of Rs4.5 billon over the five year
period 1981-1986. Similarly, Eastern Coalfields made cumulative losses of Rs3.6
billion over the same five year period. In 1988, BCCL made a loss of Rs900 million
on a turnover of Rs5.3 billion. However, in the same year the Neyveli Lignite
Corporation Limited made a profit of Rs570 million on a turnover of Rs1.9 billion.

Despite increases in output of almost 9% per annum during the duration of the
Seventh Five Year Plan, serious coal shortages still exist due to CIL'S inability to
meet specific needs such as the provision of high-quality coking and non-coking coal.
CIL'S distribution system remains poor, and the Indian Railway system is already
heavily overloaded. Consequently there are cost overruns and a buildup of coal
reserves at the pit heads. Furthermore, many of the targeted output figures are based
on projects sanctioned but not completed by CIL, thus adding to infrastructural and
distribution problems. This problem was compounded by poor coal quality, the
system of pricing, and it both added to and was affected by CIL's financial position. If
coal is to be a major source of energy and fuel in the future, CIL must be able to
generate sufficient resources internally to meet its investment requirements. In this
context, the government continues to show concern about the financial performance
of CIL. About 100 of the 248 corporations owned by the Indian government are
heavy loss-makers, and CIL is no exception. It is thus being seriously considered as a
candidate for public flotation.

Page | 12
COMPANY PROFILE

CCL is one of the 7 Coal production subsidiaries of Coal India Limited under
Ministry of Coal and Mines. Company is governed by a Board of Directors consisting
of 5 full time Directors and 6 part time Directors. Full time Directors are responsible
for specific functions of Operation, Project & Planning, Finance and Personnel.

The company is incorporated under the Companies Act, 1956 and is wholly owned by
the Government of India (GOI). Engaged in the mining of coal, coal based products
and mining consultancy. It is situated in Ranchi, Jharkhand.

The activities of the company are carried out through separate divisions with specific
functions. The operational divisions comprise Geology, Drilling and Mining. Support
services are provided by Finance Division, Materials Management Division,
Personnel & Administration Division, Commercial Division and Planning Division.

Page | 13
The next important aspect of CCL is its Project Development. During X plan five
new project namely Topa OCP (1.20 MTY), Asoka Expansion OCP (6.50 MTY) ,
Kaveri OCP (2.00 MTY) , Bermo OCP (1.20 MTY) and N.Urimari OCP (1.20 MTY)
has been envisaged for development .

    It has been planned to develop two Mega Projects viz. Magadh OCP and Amrapali
OCP, each having 12 MTY capacities, for North Karanpura Super TPS and Barh TPS
respectively. The delivery of coal is scheduled from 2008.

    It is also proposed to start mining in a few isolated patches through external
agency.

CCL has effective ways of Quality Management.The guidelines of Ministry of

Environment and Forest (MOEF) regarding supply of 34% ash coal to TPS at more
than 1000 KM or at sensitive location has created a new market opportunity. Three
non coking coal washeries are in operation at CCL providing a competitive advantage
in meeting such demand of coal. For the customer's delight in receiving value-added
coal, from coal handling plants (CHP) it has been planned to install deshaling plant.

    Use of Surface Miners in Ashoka & Piparwar Opencast Mines have been started
which shall further help in improving quality.

CCL has also developing in the fields of Information Technology in a gradual mode.
Internet facilities at each Area office and in Headquarters, Central workshop, Central
Hospital have been provided, thus facilitating faster communication through e-mail.  

Campus Local Area Network (LAN) at Headquarters has been made operative, thus
facilitating networking of all HODs and connectivity to projects in the Area through
Internet.

    The following programmes are under implementation for use of IT for Project
implementation and other operational activities in CCL are:

I. Implementation of Coal net is under process through which CCL will be

connected to Coal India Limited & its other subsidiaries and to Ministry Of

Page | 14
 Coal for speech & connectivity of data is expected soon. Coalnet expansion to
lower unit is expected soon.

II. Our company has a site on web in which following information are available :

a)    Daily production

b)    Status of inventory at central stores

c)    Status of HEMM at central workshop under repair

one of the important aspect is Human Resource Management. CCL has a series of
direct interaction drive with Managers/Engineers, Executives and all concerned
located in different coalfields of the Company has helped to change the mindset to
accept and effectively manage the 'change' through thoughtfully prepared Annual
Action Plan by them. The right preparedness, with which every unit has started
working in the beginning of the year, will bring sure success to the Company in the
form of achieving both physical and financial targets. This, by itself, will continue to
keep CCL a profit making Company.  

CCL is committed to environment protection. The Company is taking various steps

for improvement in maintaining a cleaner environment by adopting pollution control
measures and large scale afforestation. It has adopted eco-friendly mining techniques
of concurrent reclamation, thus maintaining ecological balance of the region. CCL is
giving special thrust to environment especially by reclaiming the OB dumps, hydro-
reclaiming, backfilling the voids and year after year increasing the afforestation. It
may be mentioned here that during last three years i.e. 2002-03,2003-04 and 2004-05
plantation in CCL command area has been done through Jharkhand State Forest
Department on 692 hectares of reclaimed land planting about 17,30,000 saplings of
various species viz. Karanj, Mahuwa,Bamboo, Neem, Pipal, Gamhar, Sheesham etc.

CCL is also determined to improve the Social Security of its employees. Management
is very keen in this aspect and trying to make all the payments to the retired
employees including pension payment order on the last day of superannuation.
Further, The Company has a budget provision of Rs.294.99 lakh on Community
Development Programme, besides, Rs.326.26 lakh on Education.

Page | 15
CCL contributes about Rs.810.3Lakhs in the financial year 2006-07 to State Govt.
Exchequer in the form of royalty and taxes etc. This will further increase in the
coming years. These achievements of CCL would have been much higher had there
been further improvement in the law and order situation in and around its coalfields.

VISION

The vision of Central Coalfield Limited is to become a World Class, innovative,

competitive & profitable Coal Mining Operation to achieve customer satisfaction as
top priority.

BUSINESS OBJECTIVE

 Coal Mining through efficiently operated mines

Page | 16
  Besides fulfilling coal needs of the customer in terms of quantity, focus on
quality, value addition and beneficiation to the satisfaction of the customers.

 Marketing of coal as main product

MEANS OF BUSINESS

The business of CCL is to mine Coal and sell it to the customers. The mining
methods adopted and various customers of CCL are as shown under.

Mining methods
1. Opencast

Generally opencast mine of the company employs operating method with Shovel and
Dumper combination for mining. In one of the mines namely Piparwar OcP, mobile
in pit crushing and conveying system with a pithead coal preparation plant has been
commissioned.

2. Underground

Underground Mines of the Company employs intermediate technology with

LHD/SDL and conventional manual method for mining.

MISSION

The Mission of CCL is to produce and market the planned quantity of coal and coal
products efficiently and economically with due regard to safety, conservation and
quality.

The main thrust of CCL in the present context is to orient its operations towards
market requirements maintaining at the same time financial viability to meet the
resource needs. 

Page | 17
CUSTOMERS

 POWER
o State Electricity Boards(Utter Pradesh, Punjab, Haryana and Bihar)
o Delhi Vidyut Board
o National Thermal Power Corporation(NTPC)
o Damodar Valley Corporation (DVC)
o Tenughat Vidyut Nigam Limited (TVNL), etc.
 STEEL
o Steel Authority of India Ltd (SAIL)
o Indian Iron and Steel Co.
o Rashtriya Ispat Nigam Limited (RINL), etc
 CORE INDUSTRIES
o Heavy Engineering Corporation(HEC)
o Kalyanpur Cement Company
o Association Cement Company (ACC)
o Lemo Cement Company
o Bihar Sponge Iron Limited (BSIL)
o Tata Sponge Iron Limited(TSIL)
o Indo Ashahi Glass Company (IAGO)
o Indian Aluminium Company Limited
o National Fertiliser Limited, etc.
 NON CORE INDUSTRIES
o SSF manufacturers
o Sodium Silicate manufacturers
o Brick manufacturers
o Textile manufacturers
o Paper manufacturers, etc.

INFRASTRUCTURE

 Land
 Mines

 Washeries

Page | 18
 Work shops

 Railway Sidings
 Power Supply

 Roads
 Electronics & Communication

 Medical
 Store

Page | 19
CENTRAL COALFIELDS LIMITED, RANCHI.

BALANCE SHEET AS AT 31ST MARCH ,2009.

ITEMS AS AT 31.3.2009 AS AT 31.3.2008

(RS.IN LAKH) (RS.IN LAKH)

I.SOURCES OF FUNDS

1.SHARE HOLDERS'
FUND :

a)Share Capital 94,000.00 94,000.00

b)Reserves & Surplus 38,247.52 1,32,247.5 0.00 94,000.00

2

2.LOAN FUNDS :

a)Secured 0.00 0.00

b)Unsecured 89,593.76 89,593.76 1,05,870.10 1,05,870.1

0

TOTAL 2,21,841.2 1,99,870.1

8 0

II.APPLICATIONS OF
FUNDS

1. Fixed Assets.

a)Gross Block 4,03,692.50 3,81,103.31

Page | 20
Less: Depreciation 2,69,641.86 2,46,728.25

Net Block 1,34,050.6 1,34,050.6

4 4

b)Capital Work-in- 27,174.13 43,635.33

Progress

Net 1,61,224.7 1,78,010.3

7 9

2.Investments 9,423.02 9,423.02

3.Deferred Tax Assets 16,619.36 12,972.16

4.Current Assets, Loans &

Advances:

a)Inventories 71,584.55 60,586.29

b)Debtors 61,106.59 65,984.02

c)Cash and Bank 23,482.02 18,411.43

Balances

d)Loans and Advances 1,76,455.73 67,965.43

e)Other Current Assets 11,725.79 11,682.99

Total Current Assets, Loans 3,44,354.6 2,24,630.1

& Advances 8 6

Less Current Liab. & 3,09,780.5 2,29,529.0

Provisions. 5 0

Net Current Assets 34,574.13 -4,898.84

5. Profit & Loss Account. 0.00 4,363.37

TOTAL 2,21,841.2 1,99,870.1

8 0

Page | 21
 PROFIT AND LOSS ACCOUNT FOR THE YEAR 2009.

ITEMS AS AT AS AT
31.3.2009 31.3.2008

(RS.IN (RS.IN
LAKH) LAKH)

INCOME

Sales 3,91,000.70 3,49,211.69

Coal Issued for other purposes 1,02,938.85 1,03,702.98

Accretion /Decretion in stock 13,762.05 10,910.82

Other Income 26,012.33 22,139.49

Total Income 5,33,713.93 4,85,964.98

EXPENDITURE

Colliery Consumption. 1,04,293.66 1,03,242.22

Consumption of Stores & Spares 43,457.49 41,467.01

Employees Remuneration & Benefits 1,32,292.09 1,71,845.58

Social Overhead 11,977.50 11,645.39

Power & Fuel 21,952.80 21,151.64

Repairs 12,328.84 13,436.80

Contractual Expenses 24,748.14 18,491.07

Miscellaneous Expenses 24,951.43 16,255.91

Overburden Removal Adjustment 2,179.12 5,921.83

Total Expenditure 3,78,181.07 4,03,457.45

GROSS OPERATING PROFIT 1,55,532.86 82,507.53

Page | 22
Interest 9,798.43 10,961.70

Financial Charges 235.99 265.83

Depreciation 18,977.01 18,055.49

Provisions 9,107.84 9,515.44

Write-off 15.92 0.00

PROFIT FOR THE YEAR 1,17,397.67 43,709.07

Prior Period Adj. (Debit) 899.66 -72.38

PROFIT BEFORE TAX 1,16,498.01 43,781.45

PROVISION FOR INCOME TAX 44,566.10 22,892.10

PROVISION FOR DEFERRED TAX -3,647.20 -7,097.05

FRINGE BENEFIT TAX 752.02 0.00

PROFIT AFTER TAX 74,827.09 27,986.40

PROV. FOR I.T. FOR EARLIER YEAR (WRITE 1,010.70 0.00

BACK)

APPROPRIATION

General Reserve 11,650.00 0.00

Proposed Dividend 29,140.00 0.00

Tax on Dividend 4,086.90 0.00

PROFIT UPTO THE PREVIOUS YEAR -4,363.37 -32,349.77

BALANCE CARRIED TO BALANCE SHEET 26,597.52 -4,363.37

Page | 23
 CASH FLOW STATEMENT FOR THE YEAR 2009-08.

ITEMS AS AT 31.3.2009 AS AT 31.3.2008

(RS.IN LAKH)
(RS.IN LAKH)

A. CASH FLOW FROM

OPERATING ACTIVITIES

Net Profit before Tax and

extra-ordinary items
Adjustment for: 1,17,397.67 43,709.07

Depreciation 22,913.61 10,025.9

7

Deferred Tax -3,647.20 -7097.05

O.B.R.Adjustment 2,179.12 5921.83

Interest on Investment (Tax Free -800.96 -800.96

Bonds)

Interest on Excess Payment of -83.95 -328.57

Corporate Tax

Interest on Surplus Fund Parked -3,443.80 -1148.53

With CIL

NRF (VRS Grants) credited to 0.00 0.00

P& L Account

Interest & Finance Charges 10,034.42 27,151.24 11227.53 17,800.22

Operating Profit before

working Capital Changes
Adjustment for: 1,44,548.91 61,509.29

Increase(-)/Decrease(+) in Loans - -
& Advances 1,08,490.30 55265.97

Increase(-)/Decrease(+) in 4,877.43 -1061.3

Page | 24
Debtors 4

Increase(-)/Decrease(+) in -10,998.26 -
Inventories 10502.15

Increase(-)/Decrease(+) in Other -42.80 990.34

Current Asset

Decrease(-)/Increase(+) in 48,932.44 -65,721.49 75572.98 9,733.86

Current Liabilities

Cash Flow before Extra 78,827.42 71,243.15

ordinary items

Prior Period Adjustment -899.66 72.38

Cash Flow from Operating 77,927.76 71,315.53

activities

Tax Provision -44747.13 -

15,795.05

Net Cash Flow from Operating 33,180.63 55,520.48

activities

B. CASH FLOW FROM

INVESTING ACTIVITIES

Purchase/Acquisition of Fixed -6,127.99 -

Assets (Net of Adjustment) 15477.74

Interest on Excess Payment of 83.95 328.57

Corporate Tax

Interest on Surplus Fund Parked 3,443.80 1148.53

With CIL

Interest on Investment (Tax Free 800.96 -1,799.28 800.96 -

Bonds) 13,199.68

C. CASH FLOW FROM

FINANCING ACTIVITIES

World Bank Loan through C I L -358.11 -273.13

Page | 25
Repayment of Secured Loans 0.00 -5000.00

Repayment of EFIC Loan 0.00 -2636.03

Repayment of World Bank Loan -918.23 -928.27

Repayment of CIL Loan -15,000.00 -

15000.00

Interest & Finance Charges -10,034.42 -26,310.76 - -

11227.53 35,064.96

Net Increase/Decrease in Cash

and Cash Equivalent (A+B+C )
5,070.59 7,255.84

Cash and Cash equivalent as 18,411.43 11,155.59

on 01.04.2005

Cash and Cash equivalent as 23,482.02 18,411.43

on 31.03.2006

5,070.59 7,255.84

RATIO ANALYSIS OF CCL

TABLE - 11

2009-08 2007-08

A.) LIQUIDITY RATIO:

a). Current Ratio 1.087 1.112

b). Quick Ratio 0.848 0.880
c). Cash Ratio 0.098 0.076

Page | 26
 B). ASSEST TURNOVER RATIO / EFFICIENCY RATIO:

a). Inventory Turnover Ratio 5.101 5.112

b). Sales to Fixed Asset Ratio 2.751 2.917
c). Debtors Days 51 days 50 days

C). FINANCIAL LEVERAGE RATIOS:

a). Leverage Ratio or Debt Ratio 1.996 2.324

b). Sales to Fixed Asset Ratio 2.751 2.917
c). Debtors Days 51 days 50 days

D). INCOME STATEMENT RATIO ANALYSIS:

a). Gross Margin Ratio or Gross Profit Ratio 0.2726 0.2979

b). Operating Profit Ratio 0.3548 0.3977
c). Net Profit Ratio 17.381 19.137

E). MANAGEMENT RATIOS:

a). Return on Asset Ratio 0.286 0.338

b). Return on Investment(ROI) 0.621 0.881

PLEASE REFER TO ANNEXTURE 1

Page | 27
GRAPHS – 11 TO 13: SHOWING LIQUIDITY RATIOS

11 12

Current Ratio Quick Ratio

CURRENT CURRENT
PERVIOUS YEAR CURRENT YEAR PERVIOUS YEAR CURRENT YEAR
YEAR 49% PERVIOUS YEAR YEAR 49% PERVIOUS YEAR
51% 51%

Pie-chart-1

If you compare the Current Ratios and Quick Ratios of Current Year and Pervious Year
from Pie-chart-11 and Pie-chart-12, we can see that the company is having same
percentage in both the cases that is 49% in the current year and 51% in the pervious
year. The reason for diminishing of both the ratios in the Current Year is due to the
reduction of Net Sales. The Net Sales was more in the Pervious Year as compared to the
Current Year. But the Quick Ratio and Current Ratio of less than one would start to send
out danger signals to the company because a Quick Ratio should be in the ratios of 1:1 and
the Current Ratio be 2:1.

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 Cash Ratio

Analyzing the Cash Ratio from Pie-

chart-13, we see that in the
Pervious Year it was 44% and in the
Current Year it is 56%. Since, the
PERVIOUS
Cash Ratio is more in the Current
YEAR Year; it is an indication of the
CURRENT YEAR
44% CURRENT company's ability to pay off its
YEAR PERVIOUS YEAR Current Liabilities if for some
56% reason immediate payment were
demand
13

Inventory Turnover Ratio

From the above Pie-chart-8, we can

see that the Inventory Turnover
Ratio is supposed to be 50% and
CURRENT YEAR 50% in both the years.
CUR
PERV PERVIOUS YEAR
RENT
IOUS YEAR
YEAR 50%
50%

14

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 Sales to Fixed Asset Ratio

The Sales to Fixed Asset Ratio is

51% in the Pervious Year and 49%
Current Year in the Current Year.
Current Year
Pervious Year 49%
Pervious Year
51%

15

Leverage Ratio or Debt Ratio

CURRENT
PERVIOUS YEAR CURRENT YEAR
YEAR 46% PERVIOUS YEAR
54%

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16 17

Gross Margin Ratio or Gross Profit Ratio

CURRENT
PERVIOUS YEAR CURRENT YEAR
YEAR 48% PERVIOUS YEAR
52%

GRAPHS – 14 TO 16: SHOWING ASSEST TURNOVER RATIO &

GRAPH – 17: SHOWING INCOME STATEMENT RATIO ANALYSIS

GRAPH – 18 TO 19: SHOWING INCOME STATEMENT RATIO ANALYSIS

& GRAPH – 20: SHOWING MANAGEMENT RATIOS

Operating Profit Ratio

18 The Operating profit ratio it is
53% in the pervious year and
47% in the current year. The
reduction in Operating Profit
occurred due to the Inflation of
CURRENT YEAR the Expenses and operating cost
CURRENT YEAR
PERVIOUS YEAR 47% arose. In the Pervious Year there
PERVIOUS YEAR
53% was no such Inflation of Expenses
and increase in operating cost.
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 Pie-chart-8

Net Profit Ratio

Current Year
Current Year
Pervious Year 48%
52% Pervious Year

19

R et ur n on As s et R at io

Cur r en t Ye ar
46% C ur r e n t Ye ar
P er vious Yea r
P er vious Yea r
54%

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 Return on Investment(ROI)

Current
Year
Pervious 41%
Year
59%
Current Year

Pervious Year

GRAPH – 21:
SHOWING

MANAGEMENT RATIOS

FINANCIAL ASPECTS RELATED TO CCL

CCL is a company, who has 63 mines under 11 areas. The main motto of CCL is to
produce and market the planned quantity of coal and coal products efficiently and
economically with due regard to safety, conservation and quality. The command areas

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are; - Bokaro, Chatra, Giridih, Hazaribag, Latehar, Ranchi and Palamu Districts of
Jharkhand state. Their chief consumers are:-

 Companies related to Power Generation; and

 Companies related to Steel Productions, Core Industries and Non-core

Industries.

CCL Performance During 2008-09

To-day at the end of fiscal year 2008-09, by looking back in retrospect, its gives them
immense satisfaction that Central Coalfields Limited has not only performed well, but
is poised to take a great  leap forward in registering its name amongst  the
frontrunners of profit making Public Sector Companies in the Country. During last
few years performance of CCL has improved beyond imagination of many mining
and financial pundits. A question often asked is what has brought this transformation
that a company which was written off a few years earlier has not only turned-around
but it has left behind many well established coal companies in terms of growth in
production and profitability. The answer is not very straight forward; since there has
been neither any new capacity addition nor new Projects/Mines have started in last
few years. Yet the production has jumped from 37 M .T. in 2004-05 to 40.5 M .T. in
2005-06 and now it has touched an ever highest figure of 41.35 million tones during
2008-09 . It has been possible due to hard work, change in attitude, work-culture and
above all believe in oneself that “YES they can do it”. The motivation and dedication
right from corporate level to down below at the mines was so that even the best
standards were bettered by setting new benchmarks

During this year 2008-09, the Company maintained its tempo, vigour, enthusiasm as
well as team spirit among the company employees in all the spheres of its activities
and consolidated its last year’s achievements, inspite of various odds and
unfavourable conditions, such as unprecedented heavy rains, (almost double than the

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last year), delay in getting critical spare parts of HEMMs and various bundh round
the year.

 Raw Coal Production

Central Coalfields Limited has maintained its growth during the year 2008-09 once
again by producing 41.35 million tones of raw coal, which is 2.1% more than the last
year’s raw coal production.

TABLE – 12: DETAILS OF PRODUCTION OF RAW COAL

YEARS PRODUCTION PERCENTAGE

(IN M.T.)

2004-05 37.00 31

2005-06 40.50 34

2008-09 41.35 35

The coal off-take during the year 2006-07 reached a level of 38.73 M.T., which is
highest so far in the history of CCL. Off-take has improved over the last year by 1
lakh tones.

Productivity

The productivity is measured in terms of Coal Output per Man shift. The overall
productivity of CCL during the year 2008-09 was 2.70 tones. Earning per Man shift
was Rs.781.54 during 2008-09 against Rs.765.77 of 2007-08.

TABLE – 13: DETAILS OF EARNING PER MAN SHIFT

YEARS EARNING PER MAN SHIFT (IN

Rs.)

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 2008-09 781.54

2007-08 765.77

Profitability

CCL  has achieved a profit of Rs. 1,028 crores against the budgeted profit of Rs. 984
Crores during the year 2008-09, which is continuously 5th year in a row. Due to this
profit, the net worth of the company has reached to Rs.1, 641 Crores, against the paid
up capital of Rs. 940 crores.

  Human Resource Development

Technology is changing very fast and this requires special attention for improving and
upgrading the skills of workmen from time to time. In this direction, CCL is giving
special emphasis to impart knowledge of higher/new skills to all grade of our work
force so as to facilitate their performance with new equipments.  Besides this, we are
also imparting knowledge for overall development of our employees and their family
members at various levels. During the year 2008-09, 2528 employees were trained in
various skills. The total expenditure on training was Rs.32.60 lakhs during 2007-08 as
against the expenditure of Rs.20.00 lakhs during previous fiscal.

Vision of Tomorrow

2007-08 is the starting of XI Five Year Plan. CCL is making itself ready to achieve
raw coal production of 78 M.T. by the end of XI Plan period (2011-12). In
preparation of this mammoth task during the year 2006-07, CCL has streamlined its
infrastructure such as capacity building, acquisition of land, forest land clearance,
etc.  In year 2007-08, CCL will produce 44.00 M.T of raw coal. CCL will also make
preparations  to start five new projects such as Magadh, Amrapali, North Urimari ,
Konar & Karo, to start production from these  projects during this Five Year Plan.
During XI Plan 13 new OC mines are proposed with a total production capacity of
about 28.0 MT of coal to add into the capacity.

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CONCLUSION
CCL is confident to achieve all the bench mark for the year 2008-09 in visionary and
pragmatic leadership of Sri R.P. Ritolia, CMD, Sri A.K. Singh, Dir (T/Opr), Sri Ajay
Kumar, Dir. (Pers.), Dr. A.K. Sarkar, Dir. (Fin.) and Sri R.K. Saha, Dir. (T/P&P).
Untiring efforts and team spirit of all its Executives, Employees, Officers Association
and Trade Unions, besides the guidelines of CIL and Ministry of Coal. CCL
has always got full co-operation and association from the State Government and
people at large of Jharkhand State and with their good wishes, CCL is looking
forward for achieving new heights in future.  

The overall view and comment is that the coal is natural substance which provides
energy and transformed too many vital products and products made out of its help,
provides us to live on the Almighty Earth happily and without any difficulties.
Thanks to companies such as CCL which is helping to achieve the common men
goals in the States of Jharkhand.

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Page | 38
 THE MAP SHOWING THE
LOCATION OF CENTRAL
COALFIELDS LIMITED
(CCL), RANCHI.

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 BIBLOGRAPHY:

BOOK REFERANCE:

 SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT -

PUNITHAVATHY PANDIAN.

WEBSITES:

 www.ccl.com
 www.msn.com
 www.coalindia.in
 www.new.dli.ernet.in
 www.answers.com
 www.allvoices.com
 www.referenceforbusiness.com
 wikipedia.org
 indiamicrofinance.com
 www.ismenvis.nic.in
 opinions.beta-iima.com
 companies.jrank.org
 www.companiesandmarkets.com
 economictimes.indiatimes.com
 www.economywatch.com
 www.coal.nic.in

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