List of Coal Mining Companies/Stocks in India – A Great Buying Oppurtunity

Coal Demand in India is surging as the power companies set up thermal power plants at an astounding rate to triple the power capacity over the next decade.Soaring Coal Prices have already made the Global Electricity Prices shoot up and its probably going to increase more in the coming decade.China is the world’s largest producer and consumer of coal accounting almost for the 50% of the world’s output at 3 Billion Tons.India is far behind at 400 million tons but will fast catch up given the prodigious rate of power plant building that is happening.The Environment is probably going for a toss as India has allowed “No-Go” Forested Areas to be mined.This plus China and India are importing more and more coal from Australia,South Africa and the USA.The recent looking in Australia saw coal prices shoot up alarmingly.Coal India the world’s largest coal producing company recently increased the coal price from its shockingly low price leading cement makers and utilities to raise prices more than 5-10%.While its strange for a green blog to recommend coal stocks,the opportunity does exist over the next 10 years till renewable energy comes to grid parity and policymakers don’t come to their senses.Here is a list of coal stocks/companies in India .Note there are not many major private coal companies as in the early 1970s, all privately owned coal producing companies were nationalized under the Coal Mines (Nationalisation) Act.

1) Coal India Limited (CIL)– The State Owned Giant Coal Producer dwarfs the other companies through its sheer size,scale,cost and reach.The company has fared poorly in the current year after its IPO as its production growth has almost come to Zero.However its sells coal at such a low cost,that it could easily raise prices of coal in select categories to meet its financial goals.One of the safest investments in the stock market.It posseses high level of cash,low valuation compared to global peers and has a huge room to raise coal prices in the future.

2) Neyveli Lignite Corporation is a PSU like NTPC and is also involved in lignite mining company in India. The company is mainly based out of the southern state of Tamil Nadu and mines some 24 million ton of lignite per year with an installed capacity of 2490 MW

3) Singareni Collieries Company Limited (SCCL) is a PSU  jointly owned by Andhra Pradesh and the Federal Governm .The company is involved in mining coal  in the Godavari Valley region, with reserves of around 8 Billion Tons with production of around 50 million tons a year.Note listed currently still one of the major coal companies in India.

Coal Equipment,Refining Stocks

Besides Coal Mining,there are coal mining,refining and handling equipment stocks that can be invested as a related play to Coal in India

1) Techpro Systems -The company has a good management,good growth ,is decently priced and involved in building coal handling equipment at the thermal power plants.Came out with an IPO which did reasonably ok last year

2) Gujarat NRE Coke  (GNCL)–  This private company is the largest independent producer of met coke in India with an  capacity of 1.38 milliong tons.The company has recently expanded in Australia as well.Has interests in steel making and power.The management of the company has been involved in insider trading and the stock should be avoided.

Austral Coke is another major met coke company but like Gujarat Coke has been involved big time in insider trading so an avoidable stock

Note a number of  Steel and Power Companies in India that own captive coal blocks giving them a massive advantage over other companies.There is not a grant degree of rationality in giving away cheap coal to private companies for profits as they are a national resource but thats the way how the system works giving rise to corruption.SAIL,Tata Steel,JSW Steel are some of the big  Indian steel companies owning coal blocks.Power companies like Tata Power,Reliance Power have also got some coal blocks cheaply.

Summary

Except for Coal India Limited,there are not many options to play the Indian Coal Story.This is due to a lack of private companies in the mining sector due to the old laws.Some of the companies are blatantly corrupt and some are a small portion of the main business of power or steel.However CIL remains despite its inefficiencies a great buy.

1. List of Top Power/Electricity Companies/Utilities in India – Growing Exponentially

2. India’s Environment Ministry bows to King Coal – Allows Mining in “No-Go” Forested Areas

3. Soaring Coal Prices Increasing Global Electricity Rates making Green Energy more Lucrative

4. Coal India IPO – Comprehensive News,Facts,Overview,Opinions,Price,Size and Analysis

5. Coal India Limited (CIL) IPO – In Depth Analysis of India’s Largest IPO shows it to be a Safe Investment at Cheap Valuation

6. Is Carbon Capture and Storage (CCS) Technology putting Lipstick on the Coal Pig

7. TecPro Systems IPO Analysis – Construction Play on India’s Power Sector Growth at Reasonable Price

1. Is the Coal to Liquid (CTL) Tata-Sasol $10 Billion Plant an appropriate use of India’s resources?