Gujarat NRE Coke Limited, the largest independent manufacturer of Low Ash Metallurgical Coke in India, has been a profit making organization since its inception in 1986. The company became a public limited company on 5th July, 1993. From the year 1998, under the able leadership of Mr Arun Kumar Jagatramka, the company has witnessed growth@speed of thought.
Manufacturing
The Company started coke manufacturing in its first facility located at Khambhalia, Jamnagar, with 3 chimneys and a production capacity of 0.1 million tonnes per annum (TPA) in 1994-95. Since then, the company has grown in leaps and bounds. At present, three existing coke plants in Bhachau and Khambhalia in Gujarat and Dharwad in Karnataka produce Met Coke – a commodity of critical importance to keep India’s steel dream burning. At present GNCL has an total installed capacity of 1.25 MTPA of Low Ash Metallurgical Coke (Met Coke). Gujarat NRE operates a state of the art steel plant of rolled and alloy steel products of 0.311 MMTPA at Bhachau in Gujarat. The company also has two coal washeries with installed capacity of 0.75 MMTPA each, fully operational in Khambhalia as well as in Bhachau in Gujarat. These coal washeries located adjacent to the coke plants in Gujarat, wash and sort coal imported from Australia. In addition, it has invested in wind farms with total power generation plan through waste heat 240 MW close to its plant site to get low cost power and save precious natural resources. Moreover, all plants have captive power plants (under commission) to generate electricity from the waste heat emanating from the coke making process. The company has always strived to maintain the highest quality standards and has the distinction of being the first Indian company to have exported Met Coke from India to Europe and South America. In 2004, the company exported the first ever coke consignment from India to Brazil and subsequently to South Africa. It further strengthened its presence in international market by exporting coke to Italy in June 2005. Through repeat orders and adhering to the best of standards, the company has consolidated its export market in South America, Brazil and South Africa.
Mining
The Company owns and operates 2 coal mines, NRE No.1 Colliery and NRE Wongawilli colliery (Avondale and Elouera collieries consolidated to NRE Wongawilli Colliery) having about 560 million tonnes insitu resources of finest grade metallurgical coal with excellent coking properties.
NRE No. 1 Colliery (formerly know as South Bulli Colliery), spreading over 6421hectares with resources of over 300 million tonnes of coking coal and located in the Southern Coalfields of New South Wales, Australia.
NRE Wongawilli colliery (Avondale and Elouera colliery) has estimated coal resource of about 260 million tonnes. The company is working to emerge as one of the largest coking coal producers in Australia. Mining facility is being refurbished at a steady pace, and production is being progressively increased to 7 million tonnes per annum by 2015.
Mineral Resources – Strategic Investment
It has made strategic investment in Sydney based Rey Resources Limited which gives it the exploration access to a previously unexplored area of about 4000 sq kms in Western Australia. The wholly owned subsidiaries of Rey Resources Limited are also scouting for copper and gold in South America, which too will add to the NRE basket of resources. Such partnerships strengthen the position of the Company in terms of long-term coal supply and market positioning in commodity market.
The company also has a strategic investment in Pluton Resources Limited (also listed in ASX). The investment is directed towards securing various exploration licences and exploratory work in Australia, targeting gold, silver, copper, iron ore and possibly uranium amongst other minerals.
The company with startegic investment of around 11% in Pike River Coal Ltd, New Zealand, the producer of Ultra Low-ash coking coal, for supply of 0.4 million tonnes per annum. That coal having about 1% ash content can be termed as blending sweetener.
Performance – Figures speak
The company has experienced robust growth at a CAGR of 50% with its turnover showing a magnanimous increase from Rs.56.36 cr in 2000-01 to Rs. 1308.02 cr. in quarter ended December 2008. During the same period, the profits of the company have risen sharply from Rs. Rs.4.16cr to Rs. 210.41cr. The company has continuously rewarded its shareholders through dividends and bonus issues. The company has given 5 bonuses in the last 6 years and has consistently paid dividends on the enhanced equity base thereby increasing the receipts in the hands of the stakeholders. The company has paid an aggregate dividend per share of Rs.67.23 in the last 8 years (from 2001), totaling Rs.216.76 cr.
The company prides itself in being environment friendly and has espoused a slew of measures in keeping with this mission. It has adopted the non-polluting non-recovery technology of coke manufacture and has invested in wind farms in Gujarat for a clean form of renewable energy, saving precious fossil fuel. This has enabled the company to be eligible of being a beneficiary of Carbon Credit under the Kyoto Protocol Agreement.
Listing
Gujarat NRE Coke is the first company to be listed in this sector, and today stands peerless, widely held and way ahead of its competitors. The stocks of the company are traded on the Bombay and National Stock Exchanges of India and have seen constant appreciation of capital. Against an investment of Rs.3.75 per share in June 2001, the investor received a total dividend of Rs.68.48 per share plus holding shares worth Rs.761 (adjusted for bonus issues) as on 30th October 2009, thereby depicting a compounded return of 103% per annum over the last 9 years on an average.