Coal India Will Shut 37 Mines In FY18
Coal India’s action plan is directed by the government.
State-owned Coal India Ltd. will shut down loss-making subsidiary mines which have not been able to pay salaries to workers.
The world’s largest coal miner will close 37 unviable underground mines in 2017-18, according to a stock exchange filing. The “identified” surplus manpower from these mines would be employed in nearby mines to reduce further losses.
The company generally undertakes a yearly performance study to determine the profitability of its mines. The Ministry of Coal, in its review meeting, had noted a “substantial” number of mines which were not able to recover worker salaries, the filing said. Coal India’s action plan is directed by the government, it said.
Coal India reported a decline in profit in every quarter in the year ended March. The fourth quarter profit had declined 38 percent as employee costs went up. The miner also recently reported a second straight month of decline in output as it attempts to cut down its inventory.
Shares of Coal India Ltd. closed 0.4 percent lower on speculation of the news, while the benchmark BSE Sensex rose 0.16 percent.