Kolkata, 19th September, 2009: The Board of Directors of Gujarat NRE Coke, the country's largest independent coke producer today recommended a bonus issue of “B” equity shares carrying lower voting rights in the ratio of 1 DVR Bonus share for every 10 equity shares held. The Company would seek various regulatory approvals including consent of shareholders through a postal ballot for the proposed Bonus Issue. Earlier in November 2008, the company gave two bonus equity shares for every five equity shares held. In fact, Gujarat NRE is now in the process of making the sixth bonus issues in seven years.
Commenting on the DVR Bonus Issue, Mr. A.K. Jagatramka, Chairman and Managing Director of the Company said that while the shares with differential voting rights were introduced way back in 2000 by the Government, very few companies have opted for this new instrument and as such there continued to be a very low investor awareness about this. The idea was to let all the investors have a flavour of this new instrument which could generate much higher returns to them in future as compared to the regular equity shares.
According to the Steel Ministry, investment worth US$ 176.49 billion is likely to go into the steel sector by 2020, taking the country’s steel capacity to around 300 million tonnes. As the fifth largest producer of steel, India now consumes on an average of 25 – 30 million tones of coke. At about 300 million tonnes of steel production, the demand will be roughly 120 – 150 million tonnes of coke by 2020.
Mr Arun Kumar Jagatramka, Chairman & Managing Director says “this will create a sea of opportunity for merchant coke producers in India and a Mecca for coking coal producers worldwide. Gujarat NRE Coke Ltd is geared up to take advantage of the increased demand for coke, in the face of existing acute short supply in India. We plan to invest in two additional over one million tonne coke facilities in Andhra Pradesh and Gujarat, taking our total capacity to around 4 million tonnes in the next 3-5 years. This would be further supplemented by increased production of coking coal in our Australian mines, which is slated to touch around 7 million tonnes per annum by 2014 –15.”
The investment and growth plans as well as the operations of our Australian subsidiary are on course and progressing as per plans. We have recently secured a long-term loan facility of US $ 50 million from a consortium of Indian Banks which is being utilised to support & improve the existing infrastructure and facilities and develop new ones at NRE No.1 & NRE Wongawilli collieries. The Gujarat NRE Group has earmarked plans to incur a further capital expenditure of over Australian $ 470 million by 2014 in addition to A$250 million already incurred. Various other efforts are in place to ramp up production of ROM Coal from the mines to 7 million tonnes per annum by year 2014-15. We are the only independent Company listed in Australia having pure focus on hard coking coal while all the other hard coking coal reserves are owned by the bigger resource conglomerates globally.
According to Mr Jagatramka, “in the past few years the company has made large investments in capacity expansion and integration. The company is ready to reap the fruits of these investments. The company’s new coke facility in Dharwad, Karnataka is ready for production. This provides the company extra leverage of enhanced capacity to meet the increasing demand of coke in India.” Though the current recession had its effect in the consumption of coke in the global market, the domestic scenario has been bullish. India is one of the few countries that imported coke in 2008 and is also going to do so in 2009 as well, due to increased domestic consumption levels, which augurs well for merchant manufacturers of met coke in India. Demand for coke in India has been buoyant in the first half of 2009. Shortages of coking coal are adding to the pressure in the market. Consistent and reliable supply of coking coal from Australia mines adds to the company’s advantage.
For More Information contact:
Mr Sutirtha Roy at +(91) 98790 19880 |