MOIL Prospective for Next Few Years

December 15, 2010   ·   0 Comments

Company is growing at 30-40 % from the last 3 -4 years. It is a Zero Debt Company. Making it a Strong Investment at Current Levels.

Below is a verbatim transcript of KJ Singh’s interview with Udayan Mukherjee

Q: What is the outlook for the next year or two because you have been growing at 30-40% over the last three-four years?

A: For 2009-10 our production was about 1.1 million tonne which will increase in 2011-12 to 1.15 million tonne. It will go on increasing and finally in 2015-16 it will be 1.5 million tonne.

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Q: What kind of realizations are you expecting and will you be able to hold the current level or improve on that?

A: We are getting very good response from the market. We have a realization of 70% EBIDTA and about 40-45% is PAT. This is a very good realization from the sale of manganese ore in India.

Q: How is your capacity going to move over the next couple of years? Can you give us some sense of capacity addition at MOIL and production ramp-ups?

A: 50% of the money which is coming shall go to the ministry of steel, 25% will go to the Madhya Pradesh government and the balance 25% will go to the Maharashtra state government. The present capacity for our mining is 1.1 million tonne which we will increase to 1.5 million tonne by 2015-16 and for that we have already earmarked funds of Rs 768 crore.

Q: What about your cost structure going forward? Do you think your EBITDA margins of 65% are defendable or do you think labour costs might start to eat into that?

A: 50% of our cost goes to paying our workers since we are increasing production from 1.1 to 1.5 million tonne. So there is no fresh induction of labour force in our company and we are going further down to explore our mines so the same workforce is deployed at the other level. So we don’t find any increase in cost of production even though there is increase in production.

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Rajesh Singla

Rajesh is the founder & CEO of Stockssavvy, Stocks analyst,financial advisor by choice,software engineer by fate,biker,gamer,cricket lover n enthusiastic person. He believes in doing things not just to get by but to get Ahead...

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