The coal mining business generated revenue of Rs 4,012 crore in FY23, contributing 2.25% to NTPC’s total revenue during that period.
NTPC Mining is a wholly-owned subsidiary of NTPC Ltd, established in 2019 for the purpose of undertaking mining activities.
NTPC will receive Rs 7,795 crore from the transfer of the coal mining business. This amount is based on the book value and will be payable through a combination of cash, equity shares, and debt liability, as stated in an exchange filing.
An agreement to separate the business is expected to be finalized by August 10. The entire transfer process is projected to be completed within 6 months from the execution of the agreement, subject to obtaining all necessary statutory approvals.
The coal mining business consists of 6 coal mines, and all associated assets and liabilities will be transferred from NTPC’s accounts to NTPC Mining Ltd.
The decision to hive off the coal mining business was made in conjunction with the company’s quarterly earnings. NTPC reported a 9.4% YoY increase in net profit for the quarter ended in June, amounting to Rs 4,066 crore. However, revenue from operations declined by 2.3% YoY to Rs 39,122.25 crore.
In the quarter, NTPC produced 6.24 million tonnes of coal, compared to 4.10 million tonnes in the same period last year. The plant load factor (PLF) at coal units across India improved to 70.38% from 69.23% a year ago.
On the National Stock Exchange, NTPC’s shares ended nearly 4% higher at Rs 210 compared to the previous closing price.
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